FTA underscores importance of registering for Corporate Tax

As part of its comprehensive campaign to raise awareness of Corporate Tax among business sectors, the Federal Tax Authority (FTA) held its third workshop of the year in Ras Al Khaimah (RAK), dedicated to familiarising participants with the rules for determining taxable income under the Corporate Tax framework.

In a press statement issued on Tuesday, the FTA highlighted that this workshop forms part of a series of events, delivered both virtually and in person across all emirates of the country, which will continue throughout 2025. The FTA noted that more than 2,300 participants have benefitted from the three consecutive workshops recently held in Dubai, Abu Dhabi, and RAK — including representatives from business sectors and stakeholders from both the public and private sectors involved in taxation.

During the workshop, the FTA emphasised the importance for entities subject to Corporate Tax - who have not yet registered - to promptly submit their registration applications in order to benefit from the esteemed Cabinet decision regarding the initiative to exempt Corporate Tax payers and certain categories of exempt persons, who are required to register with the FTA, from administrative penalties resulting from late submission of registration applications beyond the legally prescribed deadline.

The FTA clarified that entities subject to Corporate Tax (or exempt persons required to register) who have completed their tax registration to benefit from the exemption initiative must submit their tax returns (or annual declarations) within a period not exceeding seven months from the end date of the registrant’s first tax period, in order to meet the exemption conditions from penalties in accordance with the decision.

The FTA indicated that the exceptional condition for benefitting from the exemption - namely, submitting the tax return (or annual declaration) within a period not exceeding seven months from the end date of the tax period - applies only to the first tax period of the entity subject to tax (or the exempt person required to register), regardless of whether the due date for the first tax return (or first annual declaration) falls before or after the effective date of the new decision.

The FTA affirmed its commitment to the continuous enhancement of services provided to support and assist business sectors, in line with its plans to establish a tax environment that encourages compliance. This is achieved through ongoing awareness initiatives targeting all categories of taxpayers, aimed at familiarising them with tax legislation and procedures using various methods that ensure the information is clear and easy to apply.

The FTA noted that its representatives responded to participants’ enquiries during the workshop in RAK, which was attended by approximately 440 stakeholders involved in the implementation of Corporate Tax, along with several officials from relevant entities in both the public and private sectors.

During the workshop, representatives of the FTA provided a comprehensive explanation of the Corporate Tax Law and its related decisions, the requirements for compliance with the law, the registration procedures via the “EmaraTax” digital tax services platform, the criteria for determining taxable persons, clarification of the applicable rates and tax periods, as well as the mechanism for implementing the provisions set out in the Corporate Tax Law.

The FTA explained that the workshop highlighted the rules for determining taxable income under Corporate Tax, including how it is identified and calculated, the method for calculating the tax due, and the specific accounting standards applied for Corporate Tax purposes. It also covered the preparation of financial statements in accordance with the accounting standards adopted by the taxable person, the accrual-based accounting principles whereby income is recognised when earned and expenses when incurred, as well as an overview of financial assets, financial liabilities, and the treatment of equity in accordance with their definitions under International Financial Reporting Standards (IFRS). Furthermore, the applicable accounting methods adopted by the taxable person and the cost accounting method were also addressed.

The FTA’s representatives stressed the importance for taxable persons to familiarise themselves with the Corporate Tax Law, the implementing decisions, and the relevant guidelines, all of which are available on the FTA’s official website via the following link: https://tax.gov.ae/ar/default.aspx.

The Federal Tax Authority was established by Federal Decree-Law No. (13) of 2016 to help diversify the national economy and increase non-oil revenues in the UAE through the management and collection of federal taxes based on international best practices and standards, as well as to provide all means of support to enable taxpayers to comply with the tax laws and procedures.