In a game-changing move, the UAE Federal Tax Authority (FTA) announced on May 7 that corporate taxpayers can now breathe easier, thanks to a new exemption from administrative penalties linked to late corporate tax registrations.
This fresh approach means if you’ve missed your registration deadline, you might still dodge penalties—provided you act swiftly. Here’s the catch: taxpayers must submit their tax returns or annual declarations within seven months from the end of their initial tax period or financial year, instead of the previously allowed nine months.
Interestingly, this new seven-month timeline specifically applies to your very first tax period, regardless of when your submission deadline originally fell. In simpler terms, this isn’t just forward-looking; it includes even those already penalized.
What happens if you’ve already paid the penalty? Great news! If you previously paid an administrative penalty but meet the exemption conditions, the FTA will refund that amount directly into your account.
FTA Director-General, Khalid Ali Al Bustani, emphasizes urgency and encourages businesses not yet registered to quickly use EmaraTax for submitting registration and tax returns. Al Bustani highlighted that these measures reflect the UAE’s commitment to fostering a transparent, business-friendly tax environment, aiming to boost compliance across sectors.
The response has already been substantial, with corporate tax registrations surpassing 543,000 by the first quarter of 2025, clearly showing rising awareness and proactive engagement by businesses in the UAE.
Here’s a simple breakdown of who benefits:
- Already registered and unpaid penalty? File your return within seven months and avoid paying the penalty.
- Already registered and penalty paid? File within seven months and get your paid penalty refunded.
- Not yet registered? Hurry to register and submit your return within seven months from the end of your first tax period to qualify for exemption.
This exemption initiative underscores the UAE’s ongoing dedication to a supportive and clear tax regime, easing the burden for businesses and encouraging economic growth through seamless compliance.
Ready to navigate your corporate tax registration confidently? The key is to act promptly and leverage this opportunity to align smoothly with UAE’s tax regulations.
