CT registration/deregistration, Tax return and Payments
Every Taxable Person will be required to electronically register for UAE CT with the Authority before applicable tax period and obtain a Tax Registration Number. The registration would need to be undertaken even if the Taxable Person has already been registered for VAT purpose.
In order to keep the administrative burden on taxpayers to a minimum, the CT Law requires a Taxable Person to file only one tax return for each Tax Period.
The filing will need to be done electronically no later than nine months from the end of the relevant Tax Period. Any UAE CT payable will also need to be settled within these timelines. While further guidance on the form of the UAE CT return will be provided by the Authority, the CT Law prescribes certain specific details, which inter alia includes the Tax Period to which the UAE CT return relates, the accounting basis used in the financial statements, the Taxable Income for the Tax Period, the amount of tax loss relief claimed, the available tax credits claimed and the UAE CT payable for the Tax Period.
Financial Statements
A Taxable Person may be required to submit the financial statements used to determine the Taxable Income for a Tax Period in the form and manner and within the timeline prescribed by the Authority.
Requirement to maintain audited or certified financial statements above revenue of AED 50 Million or for a Qualifying Free Zone Person.
TP Documentation
The following TP documentation requirements could be applicable for Taxable Persons (in both Mainland and Free Zone):
- The Authority may require a Taxable Person to file a disclosure form along with the Tax Return, containing information regarding the transactions and arrangements with Related Parties and Connected Persons;
- In case conditions prescribed by the Minister are met, a master file and local file must be maintained. The master file and local file should be submitted within 30 days upon request of the Authority.
- The Authority may also require any Taxable Person to submit (within 30 days) any information supporting the arm’s length nature of the transactions and arrangements with Related Parties and Connected Persons.
A Taxable Person that meets either of the following conditions shall maintain both a master file and a local file.
- Total consolidated group Revenue = AED 3,150,000,000 or more in the relevant Tax Period, or
- Taxable Person’s Revenue = AED 200,000,000 or more in the relevant Tax
Furthermore, the above TP documentation requirements will not be applicable to a Taxable Person that would be eligible for Small Business Relief.
Record Keeping
A Taxable Person must maintain all relevant records and documents for a period of seven years following the end of the Tax Period to which they relate.
Tax Period
A Taxable Person’s Tax Period is the financial year (the Gregorian calendar year, or the twelve-month period for which financial statements are prepared) or part thereof for which a UAE CT return is required to be filed.
A Taxable Person can make an application to the Authority to change the start and end date of its Tax Period, or use a different Tax Period, subject to conditions to be set by the Authority.
Clarifications and Advanced Pricing Agreements
A Person can make an application to the Authority for a clarification regarding any part of the UAE CT Law or for concluding an advance pricing agreement for a transaction or arrangement. The form and manner of the application is to be confirmed by the Authority.
Tax Assessment
A Taxable Person may be subject to a UAE CT assessment in accordance with the Tax Procedures Law. In case a non-compliance to the CT Law will be identified during the assessment, penalties and fines determined per Tax Procedures Law could be imposed.
Other Points
The Authority will be responsible for the administration, collection, and enforcement of UAE CT, while the MOF will remain the ‘competent authority’ in terms of international tax agreements and the exchange of information for tax purposes.
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