Corporate Tax registration
In a significant move, the UAE Ministry of Finance has introduced strict penalties for companies failing to register for Corporate Tax within the stipulated timeframes. The announcement comes through Cabinet Decision No. 10 of 2024, amending the violation schedule and administrative penalties outlined in Cabinet Decision No. 75 of 2023. This decision addresses violations related to the application of Federal Decree-Law No. 47 of 2022 concerning the taxation of corporations and businesses.
Effective from March 1, 2024, the decision aims to enforce timely compliance with tax laws, particularly regarding Corporate Tax registration. The Ministry clarified that businesses failing to submit their Corporate Tax registration applications within the specified timelines will face an administrative penalty of AED 10,000. This penalty aligns with those applicable for late excise and value-added tax registration.
The implementation of Cabinet Decision No. 10 of 2024 emphasizes the importance of prompt action, with the earliest deadline set for May 31, 2024. Depending on the month the license was obtained, businesses with licenses acquired in January or February will be subject to this initial deadline.
According to the Federal Tax Authority (FTA), the new decision applies to “a judicial person that is a resident person incorporated, established, or otherwise recognized before 1 March 2024.” The FTA emphasizes the irrespective nature of the year in which the license was issued. For those without a license by March 1, 2024, the FTA mandates corporate tax registration within three months or by May 31, 2024.
This move underscores the UAE’s commitment to fostering compliance with tax regulations, ensuring businesses adhere to the Corporate Tax registration requirements in a timely manner.
