New Corporate Tax Law in the U.A.E and how to file returns

 Under the UAE Federal Decree Law No. 7 of 2022 on Corporate and Corporate Taxation1 (the "Corporate Taxation Law"), the UAE imposes a federal corporate tax (CT) on the net income of companies. The tax will take effective  July 1, 2023 or  January 1, 2024, depending on which reporting period the company follows2. TT is applicable in all  emirates.

  CT speeds are as follows:
 
 0 percent of taxable income up to AED 375,0003
 9 percent of taxable income exceeding AED 375,000 

 Certain businesses and types of income  are exempt from CT, such as:  

1.  Companies involved in the use of natural resources
2.  Dividends and capital gains earned by the UAE company on its quota units
3.  Approved intra group transactions and reorganizations
4.  Salary and other income of an individual
5.  Interest and other income earned by an individual from bank deposits or savings schemes

 To register for corporate income tax in the UAE, you must follow these steps.
 
 Log in to the EmaraTax portal by clicking on e services.tax.gov.ae and entering your registered email address and password. If you do not have an account, you can register by clicking the Register button.  A list of taxpayers will appear, and if it is empty,  a new one must be created. Select a taxpayer from the list and click View to open the panel. Click Register in the Business Tax box on the Taxpayer panel. Fill in the required details of the application form and click on the "Submit" button. You will receive a confirmation email with your Tax Registration Number (TRN) and an account activation link. Click  the link and enter your TRN and password to access your account.  You can view and edit your profile, tax reports, payments, notifications and other services from your account control panel. The corporate income tax must be submitted and paid electronically through the EmaraTax portal before the deadline. You can also request exemptions, refunds or changes through the portal if you are eligible.  You can waive corporate income tax if you stop doing business  in the UAE or if you meet certain conditions. Through the portal one must submit a  request for removal from the register and pay all unpaid tax debts.
 The deadline for reporting and paying UAE corporate income tax  depends on the financial year of your business. You have time to register until the date of submission of the first tax return. The new UAE corporate income tax system allows taxpayers  to prepare for reporting and paying taxes within 21 months of the start of the financial year. For example, companies whose fiscal year begins on June 1, 2023 and ends on May 31, 2024  must file a corporate income tax return and make payments by February 28, 2025.

 How to report and pay corporate income tax in the UAE
 To declare and pay  corporate income tax in the UAE, you must do the following:
 
 Calculate your corporation tax  on a self-assessment basis by applying the rate applicable  to your net income or profit for your financial year.  Prepare and submit the corporate income tax  electronically through the EmaraTax portal before the deadline. You must provide information such as  TRN, financial year, taxable income, tax rate, tax payable, tax paid and any exemptions or deductions claimed.  Pay your corporate income tax debt electronically through the EmaraTax portal before the deadline. You can choose from several different payment methods such as credit card, debit card, e-dirham, direct debit or bank transfer.  You will receive a confirmation email and  receipt for your tax return and payment. You can also view and download your tax returns and payment history from your account dashboard.