Missed Your Corporate Tax Deadline? FTA Offers Penalty Waiver

Missed your UAE corporate tax registration? File within 7 months to waive the AED 10,000 penalty. Act now to stay compliant and save!

Relief for Late Corporate Tax Registration

The UAE’s Ministry of Finance (MoF) and Federal Tax Authority (FTA) have rolled out a major relief measure for businesses and individuals who missed the deadline to register for Corporate Tax.

As part of the country’s ongoing efforts to support smooth compliance with the newly implemented Corporate Tax regime, a new initiative offers a waiver on administrative penalties related to late registration.

What’s the Announcement About?

Under the UAE Corporate Tax Law (Federal Decree-Law No. 47 of 2022), all taxable persons are required to register for Corporate Tax with the FTA. Failure to do so incurs a penalty of AED 10,000. Recognizing the transitional challenges many entities are facing, the FTA is now offering to waive this penalty, provided that certain compliance conditions are met.

Who is Eligible for the Waiver?

To benefit from this waiver, entities must fulfill the following key condition:

• Timely Tax Return Filing: The Corporate Tax Return or annual declaration must be submitted within seven months from the end of the first tax period.

For example, if a company’s first tax period ends on December 31, 2024, its return must be submitted no later than July 31, 2025, to qualify for the penalty waiver.

This initiative applies to both taxable entities and certain exempt persons who may still have registration obligations under the law.

What If You Already Paid the Fine?

The FTA has also confirmed that businesses that have already paid the AED 10,000 penalty but meet the waiver conditions are eligible for a refund. The mechanism for processing these refunds is expected to be announced soon.

Understanding Your Tax Registration Deadline

The Corporate Tax registration deadlines vary depending on the type of entity and when the license was issued. As a general guide:

• Natural persons (such as freelancers and sole proprietors) with annual business income exceeding AED 1 million in 2024 must register by March 31, 2025.
• Resident companies with pre-March 1, 2024, licenses have deadlines ranging from May 31 to December 31, 2024, depending on the license issuance month.
• New businesses have three months from incorporation to register.
• Non-resident juridical persons must register within nine months of establishing a taxable presence in the UAE.

How to Register?

Corporate Tax registration is done through the FTA’s EmaraTax portal (https://eservices.tax.gov.ae/). It’s best to have all your documents ready and business details updated before you begin. Not sure where to start? Get in touch with our experts today.

Final Thoughts

This waiver initiative is a clear signal that the UAE government intends to facilitate a smooth rollout of the Corporate Tax regime. Businesses that have not yet registered should act quickly to avoid financial penalties and secure their eligibility for this limited-time relief.

For specific advice tailored to your business structure, consult a certified tax advisor or reach out to the FTA directly.