How to File Corporate Tax Returns in UAE

The UAE’s Corporate Tax Law (Federal Decree Law No. 47 of 2022) establishes a legislative framework for the introduction and implementation of federal corporate tax. Under the law, corporate tax in the UAE is a direct tax levied on the net income or profit of corporations and other entities from their business.

To ensure a smooth filing system, here are some updated guidelines for you and your business, including the updated amendments under Cabinet Decision 129 of 2025 (effective 14 April 2026) revising the UAE administrative penalty framework.

Understanding Corporate Tax (UAE)

The UAE has introduced a federal corporate tax system effective from 1 June 2023. The standard corporate tax rate in the UAE is 9%, which is the lowest in the GCC region, except for Bahrain. The UAE corporate tax regime is designed to incorporate global best practices and minimize the compliance burden on businesses.

Tax applies to income earned from UAE operations, assets, or services for foreign entities with a permanent establishment in the UAE. Generally, all Taxable persons are subject to taxable income and payable to the Federal Tax Authority (FTA)

Key Terminologies under UAE CT Regime

Corporate Tax Rate & Thresholds under CT Law

The UAE has adopted a dual-tier corporate tax system effective June 1, 2023, with a 0% tax rate on taxable income up to AED 375,000 and a 9% rate on income exceeding that amount.

Bear in mind that corporate tax is a direct tax applied per tax period.

The tax payable is calculated based on the taxable income and not the accounting profit. Taxable income is determined by applying adjustments starting from accounting income, then applying the correct tax rate based on the threshold.

In some cases, it is possible to have taxable income and still end up with little to no tax payable to the government.

There are a few exceptions, especially for:

1. Free Zone businesses that meet the conditions to be considered a Qualifying Free Zone Person can benefit from a Corporate Tax rate of 0% on their Qualifying Income. Nonqualifying income is still taxed at 9%.
2. The Law provides for a supplementary tax wherein it can reach up to 15% in compliance with OECD framework.
3. Certain entities are completely exempt from being taxed (i.e. Exempt Persons), and
4. Certain types of income can be exempted as well

Free Zone entities must comply with regulations to benefit from the 0% rate on qualifying income.

Small businesses with revenue up to AED 3 million can elect for Small Business Relief, allowing them to treat their taxable income as zero until the end of 2026 (Read our guide here).

For Multinational enterprises operating in the UAE

The Domestic Minimum Top-up Tax (DMTT) has been implemented in the UAE starting January 1, 2025. The implementation of the DMTT is part of the UAE’s efforts to align with international tax transparency standards and prevent harmful tax practices.

The DMTT specifically targets MNEs with consolidated global revenues of €750 million or more in at least two of the four fiscal years preceding the tax year.

The DMTT ensures that large multinational enterprises (MNEs) pay a minimum effective tax rate of 15% on global profits.

A MNE Group is also defined as:

• Two or more companies in different jurisdictions, or
• A company with a Permanent Establishment in another jurisdiction.

The UAE’s DMTT aligns with the OECD’s Two-Pillar Solution framework.

Table Summary of Corporate Tax Rates

What Is a Tax Return in the UAE?

A corporate tax return is essentially information filed with the Federal Tax Authority for CT purposes. It must be submitted in the form and manner prescribed by the FTA and covers one taxation period.

Core components of a corporate tax return

Who Must File in UAE? (Resident vs Non Resident Persons)

To meet the strategic objectives of the federal government, all taxable persons must register for corporate tax with the Federal Tax Authority (FTA). The Ministry of Finance governs the Federal Tax Decrees, Cabinet Decisions, Ministerial Decisions and other implementing guidance under its authority, while Federal Tax Authority administers tax obligations.

Unlike traditional income tax systems applied to some jurisdictions, the UAE’s government bodies do not impose a broad personal income tax. Instead, they apply income tax direct towards businesses and certain natural persons conducting business in the UAE.

Understanding whether an entity is classified as Resident Person, a Nonresident Person, part of a Tax Group or an Person Exempt under UAE CT Law is essential in determining in determining filing obligations.

The corporate tax regime in the UAE applies to both resident and non-resident persons engaged in business activities within the country.

1. Resident Person
   A Resident Person that is a Taxable Person is generally subject to Corporate Tax and must file a Tax Return for each relevant Tax Period.

   For resident juridical persons, the Corporate Tax base generally includes income derived from the UAE and from outside the UAE, subject to the exemptions and reliefs available under the law.

   For natural persons – if they are eligible and meet the requirements for CT, bear in mind that only their business activities will be subject to corporate income tax. If an individual earns income in personal capacity, then corporate income tax may not apply.

   For example, any capital gains on personal investments, other income and earnings that fall outside of their business activities are considered as exempt income.

2. Non-Resident Juridical Persons
   A Non-Resident Person may fall within the UAE Corporation Tax regime mainly where it:
   • Have a Permanent Establishment in the UAE, or
   • A nexus in the UAE (in certain cases).

The Corporate Tax Law also recognizes State-Sourced Income, but merely earning UAE-sourced income does not by itself necessarily require a foreign entity to register and file a normal UAE Corporate Tax Return.

For example, foreign banks would be subject to CT if they follow the conditions.

Separately, the law provides for withholding tax at a 0% rate on relevant State-Sourced Income categories unless a different rate is specified.

Because the filing and registration analysis for non-residents depends heavily on the precise fact pattern, businesses should avoid treating “UAE-sourced income” as an automatic filing trigger.

Tax Groups and Group Relief

A tax group consists of two or more Taxable Persons treated as a single Taxable entity, subject to conditions. As a result, the parent company serves as the representative and files a single tax return.

A Qualifying Group allows certain reliefs while entities remain separate taxpayers. Transfers within a Qualifying Group may occur at net book value under prescribed conditions.

Tax loss transfers may be permitted between qualifying entities subject to conditions.

Intra group transactions between members of the same tax group are generally ignored for tax purposes, considering that they are treated as one taxable person. For example, if company A charges company B for management services, there is no impact on taxation at group level because both sit within the same group.

However, bear in mind that transfer pricing remains relevant for dealings with Related Parties and Connected Persons outside the Tax Group, and businesses should not assume that grouping removes all related-party compliance considerations.

We outline the specifics of tax group registration and its benefits and limitations in this free manual.

Exempt Persons

Certain types of businesses or organizations are exempt from Corporate Tax in the UAE due to their importance and contribution to the economy.

1. Government Entities and Government Controlled Entities Specified in a Cabinet Decision are exempt from Corporate Tax Law.
2. Extractive Businesses and Non-Extractive Natural Resource Businesses may also be exempt from Corporate Tax under certain conditions. The tax treatment for both an extractive business and certain non-extractive natural resource businesses remains subject to Emirate-level taxation
3. Public Benefit Entities
   A Qualifying Public Benefit Entity is conditionally exempt entities, subject to approval. Exemption is not automatic and requires formal recognition.
4. Qualifying Investment Funds To encourage investments for economic growth, investment funds can seek tax relief from the UAE corporate tax if they meet certain conditions specified by the law.
5. Public & Private Pension and Social Security Fund Social security funds operate as part of the governments broader social protection system and safeguard contributors through regulated contribution systems. Exemption applies only while the fund maintains its regulated status and meets additional conditions prescribed by the Ministry of Finance.
6. UAE-incorporated subsidiaries of specified Exempt Persons. Certain juridical persons incorporated in the UAE may also qualify for exemption where they are wholly owned and controlled by specified Exempt Persons and conduct the specific activities of the Exempt Person, subject to the statutory conditions.

This participation exemption hinges on carrying out their activities as mandated in the license. If they deviate, the Federal Tax Authority may request certain exempt persons to register for corporate tax.

To know more about the nature of corporate taxation and applicable exempted entities, read here.

When to File Corporate Tax Return (Deadlines in UAE)

Businesses liable for corporate tax in the UAE must register with the Federal Tax Authority (FTA) and file returns within 9 months of the fiscal year-end.

All businesses registered for corporate income tax must submit, regardless if they have taxes owed to the government.

If they do have tax payable, it must be settled within the same deadline applicable to filing the tax returns.

What is Tax Loss Carry Forward?

The UAE corporate tax law allows businesses to carry forward tax losses to offset against future taxable income.

A tax loss also arises where a Taxable Person has negative taxable income for a tax period. This does not eliminate filing obligations. Tax loss may affect future income taxable computation for financial years beginning on or after 1 June 2023 under the CT framework.

The FTA’s tax returns guide also includes dedicated Tax Loss schedules where Taxable Persons must:

• Disclose losses brought forward
• Reflect losses utilized in the current taxable period
• Track remaining balances carried forward to future fiscal years.

How to file online and submit returns under Corporate Tax Law (using EmaraTax)

Calculating Taxable Income

The starting point for calculating the taxable income is to determine the taxable person’s accounting income as per their financial statements.

Generally, the formula is as follows:

Corporate tax return filing in UAE is completed online through the FTA’s system (EmaraTax platform).

Step 1 – Prepare your financials and CT working papers

1. Start with understanding your net profit (or loss) from Financial Statements
2. Apply adjustments for:
   • Remove Exempt Income
   • Non-deductible expenditure
     • Government fines, late filing and compliance penalties
     • Personal expenses paid by the company
     • Dividends and profit distributions
     • Inflated management fees or above market salaries (i.e. result of excessive or not following the arm’s length principles)
     • Charitable donations or sponsorships framed as donations
   • Capital and personal expenditure
   • Interest limitation rules
   • Apply reliefs or exemptions allowed under the law
     • Previous year allowed tax loss relief
     • Exempt income categories
3. Arrive at Taxable Income

Read more on how to calculate corporate tax.

Step 2 – Confirm your details in the EmaraTax dashboard.

1. Identify the taxable person
2. Confirm the taxable period you are filing for
3. Ensure that all your details are updated

Step 3 – Calculate the tax you owe.

1. Apply applicable tax rate
   For non QFZP:
   • Below AED 375,000 : 0%Excess of AED 375,000 : 9%

   For QFZP

   • Confirm de minimis threshold first
   • Calculate 0% on qualifying income
   • Calculate 9% on nonqualifying income
2. Compute CT owed
3. Calculate your net income after taxes
4. For a negative taxable income or recording a loss in the filed returns, make sure that you meet the conditions.
   • The same person(s) must hold at least 50% ownership of the business from the loss year to the year it is used; OR
   • If ownership changes by more than 50%, the business must continue the same or similar activity.
   • There is no need for separate application, you just need to reflect it when filing.
5. When filing the corporate tax return with the Federal Tax Authority, you report the loss in the period where it occurred, specifically under the return fields for “Tax Loss Carryforward”

Step 4 – Complete the return in EmaraTax and attach the required documents.

1. Submit declaration
2. Pay the tax you owe in the same deadline
3. Maintain all relevant records and documents for 7 years following the end of the relevant Tax Period.

What Documents do you need when filing for Tax Returns?

The corporate tax system in the UAE includes transfer pricing provisions that require related party transactions to adhere to the arm’s length principle.

The Tax Returns Guide outlines required components.

Required Documents / Schedules may Include:

• Financial Statements
• Accounting schedules
• Tax Loss schedules
• Related Party schedules
• Free Zone schedules (if applicable)
• Tax Credit schedule
• Interest capping schedules
• Participation Exemption schedule
• Additional attachments (if required)

All submissions are made online through EmaraTax.

Is there a specific format (PDF/Excel) required for UAE Corporate Tax Returns?

For businesses with multiple inadmissible or admissible expenses (i.e. fines and penalties), we recommend clients to segregate them in your Chart of Accounts.

The same goes with meals and entertainment for employees and customers or other counterparties. In short, we recommend for example having:

• Fines and penalties should be recorded in a separate account, as these are generally non-deductible.
• Meals and entertainment expenses should also be segregated — especially distinguishing between employee-related expenses and those incurred for customers or other counterparties, since tax deductibility may differ.
• Exclude personal expenses (not incurred wholly and exclusively for Business)

Keeping these expenses clearly separated at the accounting level makes corporate tax computations more accurate, reduces adjustment work at year-end, and helps ensure compliance.

Complying for Corporate Tax in the UAE (including Penalties, Late Filing and Transfer Pricing Rules)

Here are the penalties to expect in 2026, effective on 14 April:

Penalties are administrative (monetary). Treat this as separate from any interest or additional charges the FTA may apply for overdue tax.

Corporate tax registration deadlines for residents

Corporate tax registration deadlines for non-residents

Failure to comply with tax regulations can lead to penalties for foreign firms operating in the UAE.

Businesses are required to retain records and supporting documents for at least 7 years following the end of each taxation period.

In addition, businesses must update their registration details within 20 business days when there are changes, such as:

• a change in authorized signatories
• a change in business address, or
• a change in fiscal year end

Keeping business details official and accurate is core compliance requirement. This prevents administrative issues or potential risky penalties during audits and reviews.

Common Mistakes for Corporate Tax

The UAE corporate tax law requires businesses to register and file annual tax returns.

Despite clear rules, several recurring mistakes can expose businesses to adjustments, penalties or compliance risk.

1. Failure to register or file on time within the prescribed deadline
2. Assuming no filing is required even when there is no tax payable
3. Failing to adjust for Exempt Income
   • Failing to adjust related expenses
   • Failing to properly segregate exempt income at bookkeeping level
4. Incorrect treatment of non-deductible expenditure (including improper classification of personal and business related expenses)
5. Not applying interest limitation rules properly and ignoring interest limitation thresholds
6. Incorrect Tax Loss carry forward calculations and failing to reflect tax loss schedule in the tax returns
7. Missing required disclosures and supporting documentation in online submission
8. Failure to account for transfer pricing rules and documentation
   • Not preparing Master File or Local File where required.
   • Inadequate benchmarking for intra-group transactions.
   • Assuming small businesses are automatically exempt

Businesses operating in UAE may have a lot of nuance to navigate. An effectively managed taxation process helps to continuously monitor and smooth these things over.

Final Checklist (for 2026 Financial Year)

Before corporate tax return filing, make sure to:

• Confirm relevant fiscal year
• Finalize Financial reports
• Adjust Accounting Income to Taxable Income
• Review non-deductible expenses
• Check interest limitation rules
• Verify Tax Loss schedules
• Complete all required online schedules
• Submit through EmaraTax with proper records
• Review and declaration
• Review and tag appropriately UAE sourced income and other sources of revenue that may be excluded (i.e. personal income is non taxable under CT, among others)

The UAE’s corporate tax regime aims to balance global tax standards with the country’s competitive business environment, which is beneficial for SMEs.

The corporate tax regime in the UAE is designed to support small and medium-sized enterprises (SMEs) by providing a lower tax rate on their initial income.

Proper record keeping can prevent a lot of headaches in the long run. Get in touch with our expert team to see how skrooge.ai can help you get your time back!

Frequently Asked Questions (FAQs) on Corporate Tax Filing