UAE has issued a Federal Decree Law of 2022 regarding corporate and business tax, which is a form of direct taxation imposed on net income and profits.

In order for companies and persons subject to corporate tax to be able to register for tax, they must know the necessary legal procedures for this, including the corporate tax declaration. In the following article, we explain to you the “corporate tax return” in UAE, how to submit it, and other matters related to it.

Corporate Tax Return in UAE and how to Submit It

The corporate tax return is that information that is submitted to the Federal Tax Authority for corporate tax purposes according to the specific forms and procedures specified by the authority, and includes the tables or attachments affiliated thereto, including the amendments contained therein.

The corporate tax return is submitted for each tax period within a period not exceeding (9) months from the end date of the relevant tax period or any other date determined by the Federal Tax Authority

Corporate Tax Return Inclusions

 The corporate tax return, as the case may be, includes at least the following information and data:

  • The tax period to which the tax return relates.
  • The name and address of the taxable person and his tax registration number (TRN).
  • Date of submitting the tax return.
  • Taxable income for the relevant tax period.
  • The amount of the tax loss facility claimed.
  • The amount of transferred tax losses.
  • Available tax credits claimed.
  • Corporate tax is payable for the relevant tax period.

The corporate tax return is submitted to the Federal Tax Authority (FTA) electronically via the Authority’s website, where the Authority will issue further clarifications regarding this in a timely manner.

Corporate Tax Return for Certain Exempt Persons

The Authority may ask these categories to submit a declaration instead of a tax return. This applies to the following categories mentioned in Article Four of the law:

  • Qualified public benefit entity.
  • Qualified investment fund.
  • Public or private pension or social insurance fund.
  • A legal person if it is established in the country and is wholly owned or controlled by government agencies or the qualified investment fund and the pension and social insurance fund.
  • The person designated by a decision of the Council of Ministers based on the proposal of the Minister of Finance.

The same applies to the authorized partner if his request to be subject to corporate tax is not approved, as the Authority may, by notification or decision issued by it, request the partner to submit a declaration on behalf of all partners in the joint venture.

Corporate Tax Return for the Tax Group

If companies meet the requirements related to establishing a tax group, and their request to form a tax group is approved, the parent company can submit a corporate tax return on behalf of all members of the tax group. In the case that these companies are unable to form a tax group, submitting a corporate tax return It is done separately for each company.

Corporate Tax Return if Income and Profits are Not Achieved

In both cases, the taxable person must submit a corporate tax return, regardless of the level of income or the status of the company. The same applies in the event that profits are not achieved, as submitting the tax return in the event of tax losses is linked to ensuring that these losses are used to reduce the taxable income in proportion to  For the coming years.

Submitting a corporate tax return according to the legal time limits and in accordance with the mechanism specified by the Authority does not mean that the taxable person does not retain documents and financial statements for the tax periods in which a tax return was submitted, as there are documents and lists that the taxable person must keep. Below we will review for you  Obligations imposed on the taxable person for tax periods:

Permit of Transfer Pricing Documents

The transfer pricing documents declaration includes information related to transactions and other arrangements made by the taxable person with the parties associated with him and persons related to him, as the Authority obliges the taxable person, pursuant to a notification or patient decision on its part, to attach this declaration with the tax return.

The taxable person must submit these documents to the Authority within a period of thirty days (30) from the date of the Authority’s request or any other date that it specifies. The same applies to information related to supporting the neutral price nature of the transactions or arrangements that the taxable person makes with the persons connected to him and the parties associated with him, as  Such documents must be submitted upon the Authority’s request within a period of (30) thirty days from the date of the request or any other date specified by the Authority.

Maintaining Records for Tax Periods

 The taxable person must retain all records and documents for a period of (7) years after the end of the tax period, as this retention aims to achieve the following:

  • Supporting the accuracy of the information provided in the corporate tax return or in any other document submitted to the Federal Tax Authority.
  • Through these records, the Authority can easily verify taxable income.

Preparing Financial Statements

 This is done pursuant to a decision or notification issued by the Authority requesting the taxable person to submit the financial statements used to determine taxable income for a specific tax period in accordance with the procedures and forms approved by the Authority in this regard.

 The Minister of Finance may also, by virtue of a decision issued by him, oblige some categories of taxable persons to prepare and maintain audited or approved financial statements.

 VAT Registration UAE, have specialized consultants in everything related to corporate tax.