Federal Decree-Law No. 47 of 2022 on the Taxation of Corporations and Businesses introduced a 9% corporate tax on taxable income exceeding AED 375,000, effective for financial years beginning on or after 1 June 2023. Every juridical person and certain natural persons conducting business in the UAE must now register with the Federal Tax Authority and obtain a Tax Registration Number.
Key takeaway
All UAE-resident juridical persons, non-resident persons with a permanent establishment or nexus in the UAE, and natural persons whose business turnover exceeds AED 1 million per calendar year are required to register for Corporate Tax. Registration is completed through the FTA's EmaraTax portal, with deadlines tied to licence issuance dates. Failure to register on time attracts administrative penalties. De-registration is only available once all tax obligations have been settled and specific conditions are met.
Legislative Framework
The primary legislation governing UAE Corporate Tax is Federal Decree-Law No. 47 of 2022 on the Taxation of Corporations and Businesses, as amended by Federal Decree-Law No. 60 of 2023. The Federal Tax Authority administers and enforces the regime, supported by a series of Cabinet Decisions and Ministerial Decisions issued since 2023 that address registration timelines, exempt persons, free zone qualifying income, and related matters.
Cabinet Decision No. 75 of 2023 specifies the categories of businesses and business activities subject to Corporate Tax for natural persons. Cabinet Decision No. 55 of 2023, together with Ministerial Decision No. 139 of 2023, sets the conditions under which a free zone entity may qualify as a Qualifying Free Zone Person and benefit from a 0% rate on qualifying income. Businesses operating in or through the DIFC or ADGM remain subject to those jurisdictions' own entity laws but are equally subject to the federal Corporate Tax regime with respect to taxable activities.
The UAE has not introduced a separate emirate-level corporate income tax; the federal law applies uniformly across all seven emirates, including special development zones and financial free zones. Where an entity is also subject to the DIFC's Companies Law or ADGM's Companies Regulations, the federal tax registration obligation runs concurrently and independently of those jurisdictional company-law requirements.
Who Must Register
Every UAE-resident juridical person — whether incorporated in a mainland emirate, a designated free zone, the DIFC, or the ADGM — is required to register for Corporate Tax regardless of whether it anticipates taxable income. This includes limited liability companies, public and private joint stock companies, and branches of foreign companies registered in the UAE. The obligation arises on incorporation or, for entities existing before the regime commenced, upon the opening of their first financial year under the law.
Non-resident persons are required to register when they have a permanent establishment in the UAE as defined under the law, derive UAE-sourced income subject to withholding, or have a nexus in the UAE by virtue of earning income from immovable property situated here. The concept of permanent establishment follows the OECD model, encompassing fixed places of business, dependent agents, and certain construction or installation projects exceeding a prescribed duration.
Natural persons who conduct business or business activities in the UAE and whose total turnover from such activities exceeds AED 1 million in a calendar year must also register. Turnover from employment income, personal investment income not linked to a licensed business, and real estate held personally is generally excluded from this threshold. Once the threshold is crossed, registration must be completed by 31 March of the following year.
Registration Deadlines for Juridical Persons
The FTA has issued guidance tying registration deadlines to the month in which a juridical person's trade licence was issued or renewed. For entities whose licences were issued in January or February, the registration deadline fell on 31 May 2024. For those with licences issued in subsequent months, staggered deadlines applied through the remainder of 2024, with all UAE-resident juridical persons required to have registered by 31 December 2024 at the latest under the transitional timeline published by the FTA.
For juridical persons incorporated after 1 March 2025, registration must be completed within three months of incorporation or establishment. Non-resident persons that develop a permanent establishment in the UAE must register within three months of the date on which the permanent establishment comes into existence. These timelines are strict; the FTA does not grant informal extensions, and the clock begins to run from the triggering event rather than from the date the entity becomes aware of its obligation.
Government entities and government-controlled entities that qualify as exempt persons under the law are still required to notify the FTA of their exempt status rather than applying for full registration, unless they conduct activities outside the scope of their exemption. Qualifying public benefit organisations must apply for and obtain Cabinet approval before they can be treated as exempt, and they too must maintain a formal registration record with the FTA.
Step-by-Step Registration Process via EmaraTax
Registration is completed exclusively through the FTA's EmaraTax portal. An entity's authorised signatory or appointed tax agent must first create or log in to an EmaraTax account, then select 'Register for Corporate Tax' and enter the entity's legal name, trade licence number, legal form, jurisdiction of incorporation, and financial year-end date. The portal will prompt for supporting documents including the trade licence, Emirates ID or passport of the authorised signatory, memorandum and articles of association, and, for free zone entities, evidence of free zone authority registration.
Once the application is submitted, the FTA reviews it and issues a Tax Registration Number, typically within a few business days for straightforward applications. The TRN must be quoted on all tax returns, correspondence with the FTA, and invoices where VAT and Corporate Tax obligations overlap. If the FTA raises a query or requests additional documents, the applicant has a defined period to respond, failing which the application may be rejected and must be resubmitted.
Tax agents registered with the FTA may submit registration applications on behalf of clients and, once authorised, will have ongoing access to the client's tax profile through their own agent portal. Appointing a tax agent does not relieve the taxable person of its primary compliance obligations; the entity remains the registered taxpayer and bears full legal responsibility for accuracy of filings and timeliness of payments.
Free Zone Persons: Special Registration Considerations
Free zone entities are subject to the standard registration obligation. However, an entity that elects to be treated as a Qualifying Free Zone Person must ensure its registration reflects this status from the outset of its first tax period. The conditions for QFZP status — including substance requirements, audited financial statements, and the restriction on earning non-qualifying income above a de minimis threshold — must be assessed before the election is made, as once a tax period opens, the election generally binds the entity for that period.
A free zone entity that fails to satisfy the QFZP conditions, or that does not make the election, is taxed as a standard taxable person at 9% on income above the small business relief threshold. Branches of mainland UAE entities operating in free zones are generally not treated as separate taxable persons; instead, their income and expenditure consolidate into the head office's tax position. Conversely, a free zone subsidiary that is a separate juridical person from its mainland parent maintains its own registration and tax profile.
The DIFC and ADGM are both designated free zones for Corporate Tax purposes. Entities incorporated there must register with the FTA in the same manner as other free zone entities, notwithstanding that they may already hold separate regulatory licences from the DFSA or FSRA. The interaction between those jurisdictions' existing company-level tax exemptions under their founding legislation and the federal Corporate Tax regime requires careful legal analysis on a case-by-case basis.
Tax Groups: Consolidated Registration
Two or more UAE-resident juridical persons that are wholly owned, directly or indirectly, by a common parent may apply to form a Tax Group and file a single consolidated Corporate Tax return. The parent company acts as the representative member and registers the group with the FTA. Each subsidiary retains its individual TRN but group-level filings are made under the parent's registration. The group must share the same financial year-end and all members must apply the same accounting standards.
Forming a Tax Group requires a formal application to the FTA and is not automatic upon meeting the ownership threshold. The application must be submitted before the beginning of the tax period for which group treatment is sought. Losses of one group member can be set off against profits of another, which is the principal commercial benefit of the structure. Where a group member is later disposed of or ceases to meet the ownership test, a de-grouping application must be filed promptly.
Free zone persons may be included in a Tax Group only if all members of the group are Qualifying Free Zone Persons, or if the free zone entity elects to be taxed as a standard taxable person. Mixing QFZP-elected and non-QFZP entities in the same Tax Group is not permitted under the current rules, which has practical implications for structuring holding arrangements that straddle free zone and mainland operations.
Corporate Tax De-registration: Conditions and Process
A taxable person may apply to de-register from Corporate Tax only if it has ceased to exist as a legal entity — for instance, upon liquidation, dissolution, or merger — or if a natural person's business turnover has permanently fallen below the AED 1 million threshold and they no longer carry on a business. De-registration is not available merely because an entity expects to have no taxable income in future periods; the legal obligation to remain registered subsists as long as the entity is a going concern.
Before submitting a de-registration application, the entity must have filed all outstanding Corporate Tax returns and paid all taxes, penalties, and other amounts due. The FTA will not approve de-registration while any liability remains unsettled. For companies undergoing formal liquidation, the liquidator bears responsibility for ensuring tax compliance is concluded before the company is struck off the relevant commercial register.
The de-registration application is submitted through EmaraTax by the authorised signatory or tax agent and must include evidence of the cessation event, such as a cancellation certificate from the relevant licensing authority or a court order of dissolution. The FTA may conduct a final review or audit before confirming de-registration. Until the FTA issues formal confirmation, the entity remains a registered taxable person and all filing and payment obligations continue to apply.
Penalties for Non-Compliance
The Cabinet Decision on Administrative Penalties issued under the Corporate Tax law prescribes a penalty of AED 10,000 for failure to register within the prescribed deadline. A further penalty of AED 10,000 applies for each subsequent failure, such as failing to notify the FTA of changes to registration details within the required timeframe. These fixed penalties are separate from any tax-geared penalties that may arise from late payment or underreporting of tax.
Late filing of a Corporate Tax return attracts a penalty of AED 500 per month for the first twelve months and AED 1,000 per month thereafter. Late payment of tax due carries a monthly penalty calculated as a percentage of the unpaid tax. Voluntary disclosure of errors in a previously filed return reduces the applicable penalty, provided disclosure is made before the FTA opens a formal audit or investigation into that period.
The FTA has discretion to waive or reduce penalties in defined circumstances, including where the taxpayer demonstrates reasonable cause for the failure. Any penalty waiver request must be formally submitted with supporting documentation; the FTA does not exercise its waiver discretion informally. Disputing a penalty follows the statutory objection and appeals process: an objection to the FTA within twenty business days, followed, if necessary, by an appeal to the Tax Disputes Resolution Committee and then to the competent courts.
Ongoing Post-Registration Obligations
Registration is the gateway to a broader set of continuing obligations. A registered taxable person must file an annual Corporate Tax return within nine months of the end of its tax period, pay any tax due by the same deadline, and maintain adequate financial records for a minimum of seven years. The FTA may request records at any time during this retention period, and failure to produce them attracts separate administrative penalties.
Where a registered entity undergoes a change in legal form, ownership structure, financial year-end, or principal business activity, it must notify the FTA within the timeframe prescribed by the relevant administrative decision. Changes to the authorised signatory or appointed tax agent must similarly be updated on EmaraTax promptly. Keeping registration details current is not merely a formality; discrepancies between registry records and FTA records can delay return processing and trigger compliance queries.
Entities that are members of a multinational group with consolidated group revenue above the threshold for Country-by-Country Reporting under the OECD framework may have additional notification and reporting obligations under UAE transfer pricing and CbCR rules. These obligations run alongside but are distinct from the Corporate Tax registration framework, and non-compliance with CbCR requirements is subject to its own penalty regime.
This article is for general information only and does not constitute legal advice. For advice on a specific matter, please contact us. Last updated: 1 July 2026.