Registration with the FTA to pay corporate tax in the UAE

Registration with the FTA to pay corporate tax in the UAE - Makebiz

Corporate taxation in the Emirates is a type of direct tax on net profits of companies at a rate of 9%. Due to new requirements, it is important to know that registration of an individual with the Federal Tax Authority for income of AED 1 million or more per year is mandatory. 

A guide from the FTA provides clear criteria for classifying individuals subject to corporate tax. Among them:

  • an individual is defined as residents and foreign nationals residing outside the UAE but earning income here;
  • earning income from business activities or a permanent establishment in the UAE with an income level of AED 1 million or more per year is a criterion for registration;
  • wages and investment profits are not taxable.

The guide provides specific examples of when a non-resident’s activities may be considered a permanent establishment in the Emirates. The description of detailed conditions, requirements and cases prevents the emergence of discrepancies in the law.

When falling under the conditions developed by the Federal Tax Administration, it is important to register and obtain a registration number. In case of non-payment of tax or failure to register within the specified time limits, the legislation provides for penalties.

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