The UAE’s Federal Tax Authority (FTA) has released a comprehensive Guide on filing and completing Corporate Tax (CT) Returns. This Guide is crucial for all Taxable Persons in the UAE. The Guide provides long-awaited clarity on the various compliance and reporting obligations for Taxable Persons.
What is Corporate tax (CT) Return?
A Corporate Tax (CT) Return is defined as “Information filed with the Authority for Corporate Tax Purposes s in the form and manner as prescribed by the FTA, including any schedule or attachment thereto, and any amendment thereof.
Overview of a Tax Return
The UAE CT return is not static, filing needs to be done online through the EmaraTax portal, with no option available for uploading an e-file that can automatically generate a downloadable version of the return on the portal. It is an active form whereby tailored questions and schedules will appear throughout the return completion process depending on the options selected by taxpayers.
A company will be required to prepare the Corporate Tax Return and update all the necessary information and submit the Tax Return to FTA via the EmaraTax portal.
About Federal Tax Authority (FTA)
Federal Tax Authority (FTA), being the Authority responsible for the administration, collection and enforcement of federal taxes in the UAE
Financial Year.
The Tax Period for a Taxable Person is the Financial Year or part thereof for which a Tax Return is required to be filed. The Financial Year shall be the Gregorian calendar year or the 12-month period for which they prepare their Financial Statements. Circumstances may arise where a Taxable Person’s Tax Period is longer or shorter than 12 months. A Taxable Person can make an application to the FTA to change their Tax Period, subject to meeting certain conditions.
Timeline
A Taxable Person is required to submit a Tax Return and pay any Corporate Tax due.
to the FTA within 9 months of the end of its Tax Period.1 This is a self-assessment process.
The form and manner are prescribed by the FTA, which can also include schedules and/or attachments. A Tax Return must be completed and filed online through EmaraTax.
Timely preparation and filing of an accurate Tax Return ensure that the relevant. Taxable Person meets their obligations, pays the correct amount of Corporate Tax and avoids penalties.
Elections:
Various elections are available under the UAE CT regime. This includes election Small Business Relief and others. The elections made will impact the form of the Tax Return.
Who is eligible for Small Business Relief (SBR)?
In order to elect for Small Business Relief, an eligible Taxable Person’s Revenue must be below or equal to AED 3,000,000 for the relevant Tax Period and all previous Tax.
Where a Taxable Person’s Revenue exceeds AED 3,000,000 in a Tax Period, the Taxable Person will no longer be able to elect for Small Business Relief, even if its Revenue is equal to or falls below the AED 3,000,000 threshold in subsequent Tax Periods.
Taxable Person details
Some of the information will be prepopulated in the Tax Return based on information provided by you as a Taxable Person at the registration for Corporate Tax purposes:
Pre-Populated information:
- Taxable Person name (in English and Arabic) Tax Registration Number for Corporate Tax (“TRN”) Address details (country, address line, city, country code, landline number, mobile number, email ID and P.O. Box)
- Tax Period
- Primary Business
- Type of Taxable Person
Amendment of Registration Data
Please ensure that the taxable person details are kept up to date in the Emara Tax portal
FTA may impose a fine if any change is not updated within 20 business days.
A Registrant shall notify the authority, in the form and manner approved by it, within (20) twenty Business Days of any change to its data kept within the Authority, including: Name, address, email address, Trade Licence Activity, Nature of Business, The address from which any business is conducted by the Registrant.
How to File Corporate Tax Return?
You’ll need to ensure your accounting records are accurately updated in your accounting system, making the filing process more straightforward and reducing the likelihood of errors.
- Register with the FTA for Corporate Tax and obtain Tax Registration Number (TRN)
- Prepare Financial Statements: A complete set of statements as specified under the Accounting Standards applied by the Taxable Person, which includes, but is not limited to, statement of income, statement of other comprehensive income, balance sheet.
- Calculate Taxable Income – Deduct eligible expenses and apply any exemptions to determine the taxable income.
- Complete the Corporate Tax Return Form – update all the necessary information via the EmaraTax portal.
- Submit the Return.
Nest steps
Prepare all your documentation required including financial statements, trade license, details of allowable expenses and exemptions, and ensure your details are accurate.
Considering the complexity and volume of financial and non-financial data required, it is strongly advisable for taxpayers to begin planning their approach to completing the UAE Corporate Tax return well in advance. It is essential for each taxpayer to identify and organise the necessary data sources.
Taking a proactive and meticulous approach—whether handling the return in-house or outsourcing the process is key to successfully navigating the challenges of the first year of tax filing.
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