These businesses file UAE's first ever corporate tax returns

Dubai: September 2025 may be the deadline for a majority of UAE companies to file their first corporate tax returns – but for some, the tax filing deadline has already passed.

Specifically, companies formed/licensed in June of 2023 and whose tax period ended on or before February 29, 2024 had until December 31, 2024 to file their returns.

It was earlier set for end September, but the FTA had given an extension. For most other companies in the UAE, their tax returns for 2024 need to be filed by September 2025.

Not just that, businesses with a June 2023 formation should have met their first corporate tax payments as well.

If they did, the businesses will also be the first to do so after the UAE instituted the corporate tax regime, which went into effect from June 2023.

Earlier, UAE corporate tax obligations were more selective, with foreign banks operating in the country coming under the tax net. The UAE’s corporate tax rate is set at 9%.

December 31, 2024 was the deadline set for those UAE licensed companies incorporated in June of 2023, and who follow the January to December calendar year as their financial year.

Now, this select batch of businesses do not have the option to wait until September 2025 to file their returns.  

At the time of their June 2023 licensing, they had one option to choose as their first financial year:

* Set June 2023 to December 2023 (7 months).

According to UAE rules, a newly formed business can have the first financial year to be up to 18 months. “So, if a company was formed in June 2023, they were only allowed the June 2023 to December 2023 as their first financial year,” said Sumayya Zain, CEO of Hallmark International Auditors. “There is no way these businesses could have chosen the June 2023 to December 2024 period as their first financial year. Because that would add up to 19 months.”

According to tax consultants, there were a sizeable number of businesses being formed or licensed in the UAE on a monthly basis all through 2023 and beyond. “It’s a given that June 2023 will have seen a fairly high number of businesses, and it’s best for them that they have their tax books in order,” said a tax consultant. “The penalties if they don’t can be quite severe.”

Jitendra Gianchandani is Chairman of JCA, and he’s not sure whether all companies have got the hang of the corporate tax requirements. While he says it can be a steep learning curve, “according to me, a majority are not yet prepared to meet the CT compliances as they are not able to analyse their business module and implications of the tax on various business transactions within their companies and group companies.

“Many companies have a broad understanding of CT, but when you dig deeper, you will see most have no ideas on carry forward of losses, or of electing prior year transactions.”

Filing the returns on the FTA's Emaratax portal is a relatively smooth process. Each company will need to do extensive self-assessment and self-declarations. Tax registrants must be fully aware of deductible and non-deductible expenses.