Federal Tax Authority issues new Decision on specified timeframes for Corporate Tax registration

• The Decision goes into effect on 1 March 2024.
• Taxable persons with a license issued in January or February are called upon to register before the end of May 2024 to avoid penalties
• Webinars on the requirements for corporate tax registration applications prior to the deadlines specified in the Decision

Abu Dhabi, UAE - 27 March 2024 – The Federal Tax Authority (FTA) has specified timeframes for Taxable Persons subject to Corporate Tax to apply to register with the FTA and avoid being in violation of tax laws.

The timeframes were outlined in a new Decision issued by the FTA regarding the deadlines to apply for registration under Federal Decree-Law No. 47 of 2022 on the Taxation of Corporations and Businesses and its amendments, which came into effect in June of last year and applies to Tax Periods starting on or after 1 June 2023.

Effective from 1 March 2024, the new FTA Decision defines timeframes for applying to register for Corporate Tax that apply to juridical persons and natural persons, that are either Resident Persons or Non-Resident Persons.

The Decision indicates that a juridical person that is a Resident Person incorporated, established, or otherwise recognised prior to 1 March 2024 must apply to register for Corporate Tax within the following timeframes:

The FTA stressed the importance of submitting Corporate Tax registration applications in accordance with the timeframes specified in the Decision. It added that taxable persons with licenses issued in January and February regardless of the year license was issued, must submit their Corporate Tax registration applications no later than May 31, 2024, to avoid tax law violations.

According to the Decision, if a juridical person does not have a license by the Decision’s effective date on 1 March 2024, they must apply to register within three months i.e. by 31 May 2024. Meanwhile, if the juridical person holds multiple licenses, the deadline to apply for registration is based on the prior issued license to determine the maximum timeframe to submit the Corporate Tax registration application.

As for a juridical person that is a Resident Person, including Free Zones Persons, incorporated, established, or otherwise recognised under the applicable laws in the UAE on or after the 1 March 2024, must apply to register for Corporate Tax within three months from the date of incorporation, establishment or recognition.

The Decision clarifies that a juridical person that is a Resident Person incorporated, established, or otherwise recognised under the applicable laws of another country or foreign jurisdiction and effectively managed and controlled in the UAE on or after 1 March 2024 must apply to register for Corporate Tax within three months from the end of their Financial Year.

The FTA decision goes on to note that a juridical person that is a Non-Resident Person who has a Permanent Establishment in the UAE prior to 1 March 2024 must apply to register for Corporate Tax within a period of nine months from the date of the existence of the Permanent Establishment in the UAE, whereas a juridical person that is a Non-Resident Person with a nexus in the country must apply to register by 31 May 2024.

A juridical person that is a Non-Resident Person on or after 1 March 2024 and has a Permanent Establishment is required to apply to register for Corporate Tax within six months of the existence of the Permanent Establishment in the UAE, whereas a juridical person that is a Non-Resident Person with a nexus in the country on or after 1 March 2024 must apply to register within a maximum timeframe of three months from the date of establishing a nexus in the UAE. 

Under the terms of the Decision, a natural person that is a Resident Person who conducts a Business or Business Activity during the Georgian calendar year 2024, and who has exceeded the Turnover threshold specified in the relevant tax legislation, must apply to register for Corporate Tax by 31 March of the following Gregorian calendar year. As for a natural person who is a Non-Resident Person who conducts a Business or Business Activity during the Georgian calendar year 2024 and subsequent years, and whose Turnover has exceeded the specified threshold, they must apply to register for Corporate Tax within three months from the date of fulfilling the conditions set out to be a Taxable Person.

The Decision stipulates that administrative penalties will be imposed on Taxable Persons who do not submit their registration applications for Corporate Tax within the timeframes specified in the FTA’s Decision for each segment of Taxable Persons, as stipulated in the Cabinet Decision No. 75 of 2023 on Administrative Penalties relating to the application of the Federal Decree-Law No. 47 of 2022 on the Taxation of Corporations and Businesses and its amendments.

The FTA announced that it will organize a series of webinars on the new Decision as part of the second phase of its comprehensive campaign to raise awareness of Corporate Tax among business sectors. The webinars aim to educate taxable persons and the concerned parties on the requirements to apply for Corporate Tax registration for each taxable person category prior to the deadlines specified in the Decision.

The Federal Tax Authority has called on all stakeholders involved in implementing the Corporate Tax Law to review the law, along with all relevant guidelines and manuals published on the FTA’s website, as well as the relevant implementing decisions, including the FTA Decision No 3 of 2024 on the Specified Timeframes for Taxable Persons Registration for the purposes of Federal Decree-Law No. 47 of 2022 on the Taxation of Corporations and Businesses and its amendments, through the following link:

https://tax.gov.ae/en/Legislation.aspx

The FTA reiterated that Corporate Tax registration is available 24/7 through the EmaraTax digital tax services platform, adding that the registration process involves four steps that take approximately 30 minutes to complete.

The FTA went on to note that taxpayers already registered for Value Added Tax (VAT) or Excise Tax can access their accounts on EmaraTax, select the taxpayer from the list, complete the Corporate Tax registration request, and submit the required documents. Once the registration request is approved, applicants can generate a Tax Registration Number for Corporate Tax purposes.

On a similar note, the FTA emphasised that taxpayers subject to Corporate Tax who are not registered must create a new user profile. New users can access the EmaraTax platform on the FTA’s e-Services portal at https://eservices.tax.gov.ae/, where they can create an account using their email address and phone number. Once the user profile is created, they can then proceed with registration by identifying the taxpayer, selecting the ‘Corporate Tax registration’ option, and easily completing the registration process.

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