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

 The United Arab Emirates imposes a federal Corporate Tax (CT) on the net income of companies under Federal Decree-Law No. 47 of 2022 on the Taxation of Corporations and Businesses. The tax became effective for financial years starting on or after June 1, 2023, and applies uniformly across all Emirates.

Corporate Tax Rates

The standard corporate tax rates are structured to support small businesses and startups while staying competitive globally:

• 0% rate: Applicable on taxable income up to AED 375,000.

• 9% rate: Applicable on taxable income exceeding AED 375,000.

Exemptions and Reliefs

Certain entities and forms of income are exempt from Corporate Tax or can claim specific reliefs, including:

• Government and government-controlled entities, as well as businesses involved in the extraction or exploitation of UAE natural resources (subject to specific conditions).

• Dividends and capital gains earned by a UAE company from qualifying intra-group shareholdings.

• Approved intra-group transactions and corporate reorganizations.

• Personal income of an individual, such as salary, employment benefits, or wages.

• Interest and other personal income earned by an individual from bank deposits or savings schemes.

• Small Business Relief (SBR): Eligible resident taxable persons with gross revenue under AED 3 million in a relevant tax period can elect to be treated as having no taxable income.

How to Register via the EmaraTax Portal

Every taxable person—including Free Zone companies and certain individuals crossing revenue thresholds—must submit a registration application to the Federal Tax Authority (FTA).

1.Access the Portal:Requires UAE PASS or Credentials.

Log in to the EmaraTax portal (eservices.tax.gov.ae) using your registered email address and password, or securely via UAE PASS. If you are a new user, click Register to set up an account.

2.Select or Create a Taxable Person Profile:Dashboard Navigation.

Review your dashboard list of linked taxpayers. If the correct entity is missing, select the option to create a new Taxable Person profile by entering the legal name, structure, and license details.

3.Initiate Registration:Corporate Tax Section.

Open the selected Taxable Person dashboard, locate the Corporate Tax option, and click Register to open the formal application form.

4.Complete Details and Upload Documents:~25 Minutes.

Fill in all required corporate details, identify authorized signatories, and upload necessary documentation (such as trade licenses, passports, and Emirates IDs). Click Submit.

5.Receive TRN:FTA Approval Buffer.

Following FTA review (which may take up to 20 business days), you will receive an approval email containing your unique Corporate Tax Registration Number (TRN).

Important Penalty Note: Under FTA Decision No. 3 of 2024, deadlines for registration are strictly fixed based on your original trade license issuance month. Missing your designated registration deadline triggers an administrative penalty of AED 10,000.

Deadlines for Filing and Payment

The deadline to both file the Corporate Tax return and pay any tax due is nine months from the end of the relevant financial period.

Unlike early transition guidance, you cannot wait until the date of filing to apply for registration without risking penalties. You must be registered beforehand to submit your return.

Financial Year End	Tax Return & Payment Deadline
May 31, 2024	February 28, 2025
December 31, 2024	September 30, 2025
December 31, 2025	September 30, 2026

Failure to file on time results in a late filing penalty of AED 500 per month for the first 12 months, rising to AED 1,000 per month thereafter. Overdue tax payments incur immediate late payment penalties and accrue ongoing interest.

Step-by-Step: Declaring and Paying Your Tax

1. Calculate Taxable Income: Reconcile your accounting net profit based on standard financial statements, making necessary tax adjustments for non-deductible expenses, transfer pricing corrections, or applicable exemptions.

2. Draft the Return Form: Log in to EmaraTax, navigate to your tax returns tab, and populate the Corporate Tax form with your exact financial year data, taxable income figures, and any specific deductions or relief elections (like Small Business Relief).

3. Submit Electronically: Carefully review the declaration screen to verify accuracy. Submit the return form directly through the platform.

4. Execute Payment: Pay your tax liability before the same 9-month deadline. EmaraTax supports direct debit, bank transfers via GIBAN, credit cards, or debit cards.

5. Retain Records: Download your submission receipt and confirmation email. The FTA requires all businesses to safely preserve corporate financial and tax records for a minimum of 7 years.

Unemployment insurance for worker's in the United Arab Emirates

 Unemployment insurance system In September 2022, the UAE launched for the first-time unemployment insurance, which will become mandatory for all workers. Federal Decree No. 13 of 2022 on unemployment insurance together with Government Decision No. 97 of 2022 on the implementation and control mechanisms of the unemployment insurance system and Decision No. 60 of 2022 on the unemployment insurance system form this that new legal framework.

 Who does the new law apply to?

The new law applies to all employees of the private sector, state or federal government, except investors (job owners), domestic workers, contract workers, youth under 18 and pensioners. who joined a new employer. It was also clarified that the scheme does not currently apply to workers in UAE free zones, but may apply in the future. Is the insurance system mandatory? Yes, it is the employee's responsibility to sign up and pay the fees. All public and private sector employees must join the system. The system came to effective on January 1, 2023, and employee registration must be completed by June 30, 2023.

New employees hired after January 1, 2023 must register with the system within four months of receiving initial work permit approval and pass. or change their status as needed. Although the employee is responsible for paying and joining the system, the law requires institutions to encourage and direct their employees to join the system and pay insurance premiums on time.

Are there penalties for negligence? Yes, non-payment or non-payment of premiums within three months of the due date will result in termination of the scheme and the employee will be required to purchase a new policy/enact and pay for that policy and a penalty of AED 00. . has not joined (if the joining schedule is extended) or 200 AED if the employee has not paid the insurance premium for more than three months. Fines must be paid through Human Resources and Emiratization (MOHRE) approved channels. Fines not paid within three months can be collected through the wage insurance system, by deducting the service fee or through another system. Please note that new work permits will not be issued to workers until all fines have been paid. Resolution No. 60 2022, which determines the procedure for paying fines, is attached to the MOHRE procedural manual.

How much does it cost to take out insurance?

Currently, contributions are AED 5 per month for employees with a basic salary up to AED 16,000 (Class 1 contributions) and AED 10 per month for employees with a basic salary above AED 16,000 (Class 2 contributions). With commission-based pay, employees can choose a membership class. How can employees join the system? Employees can book online through Dubai Insurance. The employee's Emirates ID and mobile phone number must be provided. Subscription payments can be made through various channels including; On the Internet, ATMs, currency exchange companies and many others. Payments can be made once a month, quarterly, twice a year or once a year at the discretion of the insurer. Once completed, policy documents will be emailed.

Who is entitled to compensation? The law defines the following eligibility parameters: To receive compensation, the insured must have been insured for at least 12 consecutive months from the day of joining the insurance system, and he has not been fired or left his job for disciplinary reasons. Complaints cannot be lodged due to the strike. Insurance premiums must be paid according to the payment schedule. The insurer may not have a claim for compensation. Claims for compensation must not be made by fraud or misrepresentation. The complaint must be submitted within 30 days after the end of the employment or the decision of the labor court through the website of the insurance company, smart application or call center. The insured must be legally present in the United Arab Emirates when making a claim. The insurance company is obliged to respond to the claim within two weeks from the day of submission. How much unemployment is paid? The benefit is paid monthly, calculated at 60% of the insured's basic salary and up to a maximum of AED 10,000 per month for Class 1 premiums and AED 20,000 per month for Class 2 premiums for a maximum period of three months. the date of unemployment of the insured person by application, but a maximum of 12 months of benefits during the period of insurance in the United Arab Emirates. Additional benefits can be agreed with the insurance company. Payment of compensation stops if the insured transfers to a new employer during the right to receive compensation. Who are the insurers? The service providers are private insurance companies licensed by the central bank that meet the requirements for providing unemployment insurance issued by the government of the United Arab Emirates in consultation with the central bank or other government agency providing unemployment insurance services.

MOHRE published a list of insurance companies represented by Dubai Insurance Company which include:

•    Abu Dhabi National Insurance Company,
•   Al Ain Ahlia Insurance Company,
•   Emirates Insurance Company,
• Orient Insurance,
•   Oman Insurance,
•   National General Insurance Company and
• Orient UNB Takaful Company.

What can employers do?

 Although the onus is on the employee to obtain unemployment insurance, the law clearly states that facilities must encourage and direct their employees to join the system, and therefore employers should educate their employees about this new requirement and the timeline for compliance. Failure to do so can have a direct impact on the renewal of the employee's work permits, which in turn can cause administrative disruptions and burdens for the employer.

U.A.E Ministry of Finance issue decision on small business relief on Corporate Tax

The Ministry of Finance (MoF) has issued Ministerial Decision No. 73 of 2023 on Small Business Relief for the purposes of Federal Decree-Law No. 47 of 2022 on the Taxation of Corporations and Businesses (Corporate Tax Law).

The decision is issued in accordance with Article 21 of the Corporate Tax Law, which treats the taxable person as not having derived any taxable income in a given tax period where the revenue did not exceed a certain threshold.

Small Business Relief is intended to support start-ups and other small or micro businesses by reducing their Corporate Tax burden and compliance costs. The Ministerial Decision on Small Business Relief specifies the revenue threshold and conditions for a taxable person to elect for Small Business Relief and clarifies the provisions of the carried forward Tax Losses and disallowed Net Interest Expenditure under the Small Business Relief scheme.

The Ministerial Decision on Small Business Relief stipulates the following:

1. Taxable persons that are resident persons can claim Small Business Relief where their revenue in the relevant tax period and previous tax periods is below AED3 million for each tax period. This means that once a taxable person exceeds the AED3 million revenue threshold in any tax period, then the Small Business Relief will no longer be available.

2. The AED3 million revenue threshold will apply to tax periods starting on or after 1st June 2023 and will only continue to apply to subsequent tax periods that end before or on 31st December 2026.

3. Revenue can be determined based on the applicable accounting standards accepted in the UAE.

4. Small Business Relief will not be available to Qualifying Free Zone Persons or members of Multinational Enterprises Groups (MNE Groups) as defined in Cabinet Decision No. 44 of 2020 on Organizing Reports Submitted by Multinational Companies. MNE Groups are groups of companies with operations in more than one country that have consolidated group revenues of more than AED3.15 billion.

5. In tax periods defined in the decision where businesses do not elect to apply for Small Business Relief, they will be able to carry forward any incurred Tax Losses and any disallowed Net Interest Expenditure from such tax periods, for use in future tax periods in which the Small Business Relief is not elected.

6. With regard to the artificial separation of business, the Ministerial Decision specifies that where the Federal Tax Authority (FTA) establishes that taxable persons have artificially separated their business or business activity and the total revenue of the entire business or business activity exceeds AED3 million in any tax period and such persons have elected to apply for Small Business Relief, this would be considered an arrangement to obtain a Corporate Tax advantage under Clause (1) of Article 50 regarding the general anti-abuse rules of the Corporate Tax Law.

All Cabinet Decisions and Ministerial Decisions issued relating to the Corporate Tax Law are available on the Ministry of Finance's website: www.mof.gov.ae

How to report minor incidents and crimes to Dubai Police

 Dubai Police has reminded you what to do if you have been involved in a minor car accident or need to report a crime. Through social media, authorities have urged residents to follow road safety rules and use the Dubai Police's official app to report minor road accidents. 

1st Police Eye: The Police Eye service was introduced a few years ago to allow residents to report crimes and help keep their community safe. The service is available through the Dubai Police app, website and police stations.
2. Smart Police Stations: These unmanned police stations in Dubai allow residents and tourists digital access to services 24/7 without human intervention. Minor motor vehicle accidents can be reported at stations where Police Eye also operate.
3. Computer crime: Cyber crime can be reported through Dubai Police's dedicated e Crime channel.Residents can access the website "www.ecrime.ae". A notice on the Dubai Police Department's website states that the service only applies to crimes committed within the geographic scope of the city of Dubai.
4.call center; Dubai Police Call Center can be used to report minor offenses by dialing 901. This number is intended for non-emergencies. It can be reached from outside Dubai by dialing 04-901