Annual Corporate Tax Return

Filing Deadline

The Corporate Tax return must be filed with the FTA through EmaraTax within 9 months following the close of the tax period (Federal Decree-Law No. 47 of 2022, art. 53). For a financial year ending on December 31, 2025, filing must be completed no later than September 30, 2026.

Payment of the tax due must be made within the same deadline (art. 48).

Scope of the Return

The return comprises several sections:

1. Identification — TRN, legal name, relevant tax period.
2. Accounting result — extract from the audited IFRS financial statements.
3. Tax adjustments — add-backs, deductions, transfer pricing adjustments.
4. Taxable income computation — application of the rules in Article 20 et seq. of Federal Decree-Law No. 47 of 2022.
5. Application of exemptions — small business relief, participation exemption, business restructuring relief.
6. QFZP status — confirmation that the conditions are met, for eligible Free Zone Persons.
7. Tax due computation — 0% up to AED 375,000, 9% above that threshold; 0% on qualifying income for QFZPs.
8. Foreign tax credits — crediting of foreign tax paid on foreign-source income.
9. Determination of the balance payable or refundable.

Financial Statements and Audit

Entities generating revenue exceeding AED 50 million and all QFZP entities must provide audited financial statements prepared by an auditor licensed in the UAE (Ministerial Decision No. 82 of 2023). For other entities, unaudited financial statements may suffice.

The applicable accounting standards are IFRS (or IFRS for SMEs for small entities, subject to conditions).

QFZP Status in the Return

QFZP status applies automatically where the conditions of Article 18 are met, but it is reflected each year in the return: the entity confirms its Qualifying Free Zone Person status and the split between qualifying and non-qualifying income. Conversely, the entity may elect to be subject to the standard Corporate Tax regime (art. 19) — an election that is then irrevocable for the period prescribed by the legislation.

The 0% rate is available only if all cumulative conditions are satisfied for the relevant tax period (substance, qualifying activities, de minimis, audited accounts, transfer pricing).

Payment of the Tax

Payment is made through EmaraTax by:

• Bank transfer to the FTA account.
• Card payment (Visa, Mastercard) for modest amounts.
• GIBAN (the dedicated tax IBAN issued by the FTA for transfers).

The payment deadline is identical to the filing deadline: 9 months after year-end.

Late-Filing Penalties

Documents to Retain

The entity must retain all tax documents for 7 years from the close of the tax period (Federal Decree-Law No. 47 of 2022, art. 56):

• Audited financial statements.
• General ledger, journal, and trial balance.
• Invoices issued and received.
• Commercial and intra-group contracts.
• Transfer pricing documentation (Local File, Master File for eligible groups).
• Substance supporting evidence (leases, employment contracts, DEWA payments).
• Computations and QFZP status documentation.

Special Cases

First Tax Period

For entities incorporated after June 1, 2023, the first tax period may be extended to a maximum of 18 months. The first return is then due 9 months after the close of that extended period.

Cessation of Activity

In the event of cessation of activity (liquidation, merger, transfer), a tax deregistration application must be filed within 3 months following the triggering event (FTA Decision No. 6 of 2023). Deregistration in EmaraTax is conditional upon the filing of the final returns and payment of the tax due.

Common Mistakes

• Missing the 9-month deadline and accumulating penalties.
• Failing to verify each year that the QFZP conditions are actually met before reporting the 0% rate.
• Underestimating the scope of the mandatory audit for QFZPs.
• Omitting transfer pricing documentation for eligible groups.
• Failing to retain substance supporting evidence for 7 years.