Tax Compliances and Administration- UAE CT Law

Background and Synopsis 

The UAE Corporate Tax Law is a significant development in the taxation system. It was implemented to establish a comprehensive framework for corporate taxation, ensuring fairness, transparency, and compliance in the business sector. The law aims to promote economic stability and align the UAE with international taxation standards. 

Under the UAE Corporate Tax Law, tax compliance and administration play a crucial role in ensuring that businesses fulfill their tax obligations accurately and efficiently. The law encompasses various provisions and regulations that govern tax compliance procedures, reporting requirements, and administrative processes.  

Important Definition of Terms and Expressions 

Taxable Income: “The income that is subject to Corporate Tax under this Decree-Law.” 

Taxable Person: “A Person subject to Corporate Tax in the State under this Decree-Law.” 

Foreign Tax Credit- “Tax paid under the laws of a foreign jurisdiction on income or profits that may be deducted from the Corporate Tax due, in accordance with the conditions of Clause 2 of Article 47 of this Decree-Law.”  

Tax Period- “The period for which a Tax Return is required to be filed.” 

Tax Return- “Information filed with the Authority for Corporate Tax purposes in the form and manner as prescribed by the Authority, including any schedule or attachment thereto, and any amendment thereof.” 

Accounting Standards: “The accounting standards specified in a decision issued by the Minister for the purposes of the Corporate Tax Law”. 

Financial Statements: “A complete set of statements as specified under the Accounting Standards applied by the Taxable Person, which includes, but is not limited to, statement of income, statement of other comprehensive income, balance sheet, statement of changes in equity and cash flow statement.” 

Topic 1: Payment and Refund of Corporate Tax 

Corporate Tax Payment 

Article 48 of the UAE Corporate Tax Law states that Corporate Tax must be paid within nine months of the conclusion of the applicable Tax Period or by a date determined by the FTA. This allows taxpayers to pay their Corporate Tax at the same time as completing their returns because it coincides with the deadline for filing tax returns. This strategy seeks to ease taxpayers’ compliance burdens while reflecting the self-assessment character of Corporate Tax. 

Corporate Tax Refund 

The procedure for receiving a refund for Corporate Tax that has been overpaid is covered in Article 49 of the UAE Corporate Tax Law. The need for refunds when Taxable Persons have paid more than necessary is emphasized in the provision.  

In accordance with Clause 1, Taxable Persons may request a refund of Corporate Tax from the Authority in one of two situations:  

• Either when the Taxable Person’s Withholding Tax Credit exceeds the Corporate Tax due for a particular Tax Period, or  
• When the Authority is satisfied that the Taxable Person has paid more Corporate Tax than necessary. 

According to Clause 2, the Authority will issue notice on the decision for requests for refunds in accordance with the steps established in the Tax Procedures Law.  

 

Topic 2: General Anti-Abuse Rule 

A broad anti-abuse rule for Corporate Tax is introduced with the intention of preventing taxpayers from abusing the law’s provisions to lower their tax obligations. The Corporate Tax Law encourages a business-friendly climate while simultaneously containing protections for the integrity of the tax system. By addressing abusive tax evasion methods in specified situations, this provision streamlines the law. 

Anti-abuse Rule 

The criterion under Article 50 determines whether a transaction was entered into with the primary goal of obtaining a Corporate Tax Advantage in violation of the law’s intent without a valid commercial or non-fiscal rationale.  

Corporate Tax Advantage: Article 50(2) provides instances of Corporate Tax Advantages which include obtaining a refund or increased refund, avoiding or reducing tax payable, deferring tax payment, or advancing a tax refund. Additionally, the rule applies to the avoidance of obligations to deduct or account for Corporate Tax. 

Power to modify or offset Corporate Tax Advantage: The Authority is given the power to modify or offset Corporate Tax Benefits received through transactions or arrangements covered by the anti-abuse regulation under Article 50(3). By doing so, the Authority is able to overturn the tax result and treat the transaction or arrangement in accordance with its actual economic implications. The Authority conducts an assessment to put this into action. 

Steps to be taken by the FTA: The FTA shall issue an assessment to the effect of recharacterizing the nature of a payment or amount, disregarding the implications of other provisions, and allowing or disallowing exclusions, deductions, or reliefs in the calculation of Taxable Income or Corporate Tax payable. 

Additionally, even if they are not directly involved, the Authority is permitted to make compensating modifications to the tax obligations of anyone affected by the transaction or arrangement. 

A non-exhaustive list of the relevant information and circumstances that must be taken into account by the Authority when making a decision is provided in Article 50(5). 

Article 50(6) confirms that in cases where a proceeding is brought regarding the application of the Article, it is the Authority’s duty to show that its decision was fair and reasonable. 

 

Topic 3: Tax Registration and Deregistration 

Tax Registration 

The obligations and prerequisites for registering for Corporate Tax with the Authority are covered in Article 51 of the UAE CT Law. All Taxable Persons are required to register for Corporate Tax, and registration must be completed in the required format and within the required time frame. Each Person who registers will get a Tax Registration Number that they have to use while filing Tax Return with the Authority. 

• Some categories of Exempt Persons are required to register for Corporate Tax and get a Tax Registration Number, as stated in Article 51(2). These categories include juridical persons incorporated in the UAE that are fully owned and controlled by exempt government entities, Qualifying Investment Funds, or pension or social security funds, as well as any other Persons determined by FTA. 

Article 51(3) states that the Authority has the power to unilaterally register someone for Corporate Tax in order to ensure compliance with the law. 

Tax Deregistration 

The procedure for deregistering a Person for Corporate Tax purposes is described in Article 52. In accordance with its provisions, a Person may be deregistered if their Business or Business Activity has ceased to exist and they have complied with certain conditions, such as paying all unpaid Corporate Tax and Administrative Penalties and finishing the required filing requirements.  

The process for deregistering involves submitting a Tax Deregistration application when a person’s business shuts down or they stop conducting any business activities. The Authority will choose the precise specifications and deadline for this application. 

The Authority will deregister the Person for Corporate Tax if the Tax Deregistration application is approved. If a person doesn’t follow the deregistration conditions, the Authority has the discretionary power to deregister them. If the Authority uses this power, deregistration will go into effect on the last day of the Tax Period in which the requirements are met or on the date the Taxable Person ceases to exist, whichever comes first. 

Recent Development 

Exemption from Registration 

There are, however, some categories of Persons that might be exempt from the registration obligation. They are:  

• Government Entities,  
• Government Controlled Entities,  
• Persons Engaged in Extractive Business,  
• Non-Resident Persons with UAE-Sourced Income and no Permanent Establishment in the UAE, and  
• Persons Engaged in Non-Extractive Natural Resource Business. 

It is important to note that if any of these Exempt Persons engage in a Business or Business Activity that is subject to Corporate Tax, they will need to register for Corporate Tax with the Authority. 

Deregistration Timeline 

The Authority will deregister the Person for Corporate Tax if the tax deregistration application is approved. The cessation date or another date chosen by the Authority may serve as the effective date of deregistration. It means that an individual has 3 months from the date their business ceases to apply for tax deregistration, while companies and organizations have 3 months from the date of their entity’s cessation to apply for tax deregistration. 

 

Topic 4: Tax Returns and Clarifications 

A Tax Return is a crucial requirement for every Taxable Person under the UAE Corporate Tax Law. It involves filing relevant information about their Corporate Tax Liability and making the necessary payment to the tax authorities.  

Obligation to File Tax Returns under the UAE Corporate Tax Law 

A Tax Return is filed with the Federal Tax Authority, providing details of a person’s income for a particular year and the corresponding tax obligations. Regardless of the amount of income or the entity’s status (active or dormant), all Taxable Persons are required to file a Tax Return under the UAE’s Corporate Tax Law. Even if the corporate entity has incurred a loss for a particular Tax Period, the UAE Corporate Tax Return has to be digitally filed with the FTA. 

What is the Deadline for Filing Tax Returns under the UAE Corporate Tax Law?  

The Tax Return must be submitted within a period of nine (9) months following the conclusion of the applicable Tax Period. The FTA may specify alternative filing dates for the UAE CT Return. It is important to note that the UAE CT Return must be filed in the manner specified by the Authority. 

Filing Tax Returns for a Tax Group:  

For a Tax Group, the parent company is responsible for filing the Tax Return. 

Required Information in the Tax Return as per the UAE Corporate Tax Law  

The Tax Return should contain the subsequent details:  

1. The relevant Tax Period for which the Tax Return is being filed. 

1. The Tax Registration Number (TRN) of the Taxable Person. 

1. The Taxable Individual’s name and residence. 

1. The date on which the Tax Return was filed. 

1. The accounting basis applied in preparing the Financial Statements. 

1. The Taxable Income calculated for the relevant Tax Period. 

1. The amount of Tax Loss relief claimed by the taxpayer (as per Article 37). 

1. The amount of Tax Loss transferred by the taxpayer (as per Article 38). 

1. The Tax Credit claimed by the taxpayer (as per Articles 46 and 47). 

1. The Corporate Tax payable in the relevant Tax Period by the taxpayer. 

If the Authority requires any additional information, documents, or records, the taxpayer must provide them to the FTA. 

Exception to form and manner of filing of UAE CT Return in cases of National Security or Public Interest 

While the Federal Tax Authority prescribes the form and manner of filing Tax Returns, certain circumstances related to national security or public interest may require special considerations. In such cases, the Minister has the power, under Article 53(4) of the UAE Corporate Tax Law, to determine the filing procedures for Tax Returns that may impact national security or public interest. 

Designated Entities to Submit Declarations along with Tax Returns under the UAE Corporate Tax Law 

 The Authority may request the following Taxable Persons to submit a declaration along with their UAE CT Return: 

1. Qualifying Investment Fund 

1. Qualifying Public Benefit Entity 

1. Public Pension or Social Security Fund 

1. A juridical person entirely owned or controlled by certain Exempt Persons 

1. Any other person as determined by the Cabinet, based on suggestions from the Minister 

Submission of Financial Statements as per the UAE Corporate Tax Law  

Financial Statements are crucial for reflecting a company’s financial performance and position. They typically include balance sheets, cash flow statements, and income statements. In the context of the UAE Corporate Tax Law, Taxable Persons are required to prepare Financial Statements in accordance with the accounting standards in the UAE, commonly known as International Financial Reporting Standards (IFRS). 

Request for Financial Statements by the FTA 

The Federal Tax Authority may request the Taxable Person to submit the Financial Statement used for determining their Taxable Income in the relevant Tax Period. This request can be made through a notice or decision issued by the Authority. The Taxable Person must provide the Financial Statement in the prescribed form and within the specified time period. 

Request for Financial Statements of an Unincorporated Partnership 

In the case of an Unincorporated Partnership, a partner may be requested by the Federal Tax Authority to submit the Financial Statements for the relevant Tax Period. These Financial Statements should include additional details such as the total assets, liabilities, expenditures, and income of the Unincorporated Partnership, as well as the distributive share of each partner in the partnership. 

Record-Keeping of Documents and Relevant Information in accordance with the UAE Corporate Tax Law 

The UAE Corporate Tax Law specifies the duration for which Taxable Persons must maintain records related to Corporate Tax. 

What is the Duration for Retaining Records under the UAE Corporate Tax Law? 

Taxable Persons must retain documents and records for a period of seven (7) years following the conclusion of the relevant Tax Period. 

Which Records are to be maintained? 

The records that Taxable Persons are required to maintain comprise: 

1. Records related to the supporting information provided in the Tax Return. 

1. Records related to any other document filed with the Authority. 

1. Documents that can assist the Federal Tax Authority in determining the Taxable Income of the Taxable Person. 

Documents to be maintained by Exempt Persons 

In addition to the general record-keeping requirements, Exempt Persons must maintain records pertaining to their Exempt status for a period of seven (7) years from the end of the relevant Tax Period. These records should be retained to enable the Federal Tax Authority to verify and determine the Exempt Person’s eligibility for exemption. 

Applicable Tax Period for Submitting Tax Return under the UAE Corporate Tax Law 

The Tax Period refers to the specific period of the financial year for which the Tax Return is to be filed by the Taxpayer. 

According to this provision, the Tax Period is considered to be a twelve (12)-month period based on the Gregorian Calendar when Financial Statements are prepared by Taxable Persons. 

Modification of Tax Period under the UAE Corporate Tax Law 

While corporate entities in the UAE typically follow the Gregorian Calendar Year or a twelve (12)-month period, the UAE CT Law allows for flexibility in determining the Tax Period. A Taxable Person can request a change in the start date, end date, or even a different Tax Period altogether. 

To initiate a change in the Tax Period, the Taxable Person must submit an application to the Federal Tax Authority. The Authority has the discretion to accept the application and may impose certain conditions regarding the new Tax Period. 

Application for inquiry to FTA under the UAE Corporate Tax Law 

Taxpayers may have doubts or queries regarding certain aspects of the UAE Corporate Tax Law, and to address these concerns, they can seek clarifications from the Federal Tax Authority. 

Clarification regarding APA: If a Taxable Person has doubts regarding the conclusion of an Advance Pricing Agreement (APA) pertaining to a transaction or agreement entered into by the Taxable Person, they can seek clarification from the Authority. 

Clarification regarding CT Law: Similarly, if a Taxable Person requires clarification regarding the application of the UAE’s Corporate Tax Law, they can submit an application to the Federal Tax Authority. 

The Federal Tax Authority has prescribed the manner and form of such applications in a ‘User Guide.’ This guide provides detailed information on how a Taxable Person can seek private clarification from the Authority on specific tax matters for which further information is needed. 

Recent Developments 

1. Taxable Persons Who Must Prepare and Maintain Audited Financial Statements
   According to the updated decision, Taxable Persons falling under the following categories shall prepare and maintain audited financial statements:

1. A Taxable Person with Revenue exceeding AED 50,000,000 during the relevant Tax Period. 

1.  A Qualifying Free Zone Person. 

B: Change in Tax Period 

Under Article 58 of the UAE Corporate Tax Law, a Taxable Person can request a change in their Tax Period by applying to the Federal Tax Authority (FTA). However, certain conditions must be met for such a change to be approved. These conditions include: 

1. Reason for Change: The change in Tax Period must be motivated by specific reasons, such as the liquidation of the Taxable Person or aligning the Financial Year with other entities for tax grouping, reporting purposes, tax relief, or foreign jurisdiction requirements. Additionally, a valid commercial, economic, or legal reason may also be considered. 

1. Unfiled Tax Return: The Taxable Person should not have filed the Tax Return for the relevant Tax Period for which they are seeking a change. 

1. Application for change in Tax Period: The application for altering the Tax Period can be made to extend the current Tax Period for a maximum of 18 months or to shorten the next Tax Period to a duration between 6 and 12 months. 

1. Application Timeline: The application must be submitted within 6 months from the end of the original Tax Period. 

1. Limitation on shortening Tax Period: If the Taxable Person has already filed an application to shorten a Tax Period, it should not relate to a prior or current Tax Period. 

The implementation of this decision will be effective from June 1, 2023, after its publication in the Official Gazette. 

 

Topic 5: Violations and Penalties under UAE Corporate Tax Law 

Article 60 of the UAE Corporate Tax Law plays a significant role in ensuring compliance and fair tax practices. It outlines the process of assessing Corporate Taxes and establishes penalties for violations or non-compliance with the Tax Procedures Law.  

Corporate Tax Assessment under UAE Corporate Tax Law 

The assessment of Corporate Taxes for Taxable Persons follows the Tax Procedure Laws of the UAE, as well as the relevant decisions implemented to enforce the provisions of the law. When a Taxable Person files their Tax Return, the information provided undergoes a thorough review and evaluation to verify its accuracy and detect any attempts to evade tax liabilities. 

Request for Assessment by a Taxable Person under UAE Corporate Tax Law 

Additionally, Taxable Persons have the option to request an assessment of their Corporate Tax from the Federal Tax Authority. The FTA may issue guidelines specifying the situations, conditions, and circumstances under which such requests can be made or when a Corporate Tax Assessment can be initiated by the FTA itself. 

Penalties Imposed on Taxable Persons for Violations of UAE Corporate Tax Law 

To ensure compliance with the law, penalties and fines are imposed on Taxable Persons who fail to adhere to the provisions outlined in the UAE Corporate Tax Law. The determination of these penalties is based on two key factors: 

1. The Tax Procedures Law: Penalties are determined according to the provisions of the Tax Procedures Law. 

1. Relevant Decisions: Penalties are also influenced by the decisions implemented to enforce the provisions of the Corporate Tax Law.  

 

Topic 6: Assessment under UAE Tax Procedures Law 

The UAE Tax Procedures Law plays a pivotal role in regulating tax-related matters in the country. Among its crucial provisions, Article 23 focuses on Tax Assessment, which determines the value of the payable tax, refundable tax, and other tax-related issues.  

Tax Assessment: A Key Component of UAE Tax Procedures Law 

• Understanding Tax Assessment  

Tax Assessment serves as a mechanism for evaluating the tax liabilities of taxpayers. It involves the issuance of a Tax Assessment by the FTA. The primary objective is to ascertain the accuracy and completeness of Tax Returns and to ensure compliance with the provisions. 

• Cases Requiring Tax Assessment 

Article 23 specifies various scenarios in which the Authority must issue a Tax Assessment. These include:  

• Failure to register within the specified timeframe,  
• Failure to submit a Tax Return,  
• Non-payment of stated payable tax,  

• Submission of incorrect tax returns,  
• Failure to calculate tax on behalf of another person,  
• A shortfall in payable tax due to tax evasion, and  
• Other cases as defined by the Tax Law. 

Estimated Tax Assessment 

• Need for Estimated Tax Assessment  

In certain situations, determining the actual amount of due tax or the correctness of a tax return may pose challenges. In such cases, the Authority has the power to issue an estimated Tax Assessment to assess payable and refundable taxes based on available information.  

• Procedure for Issuing Estimated Tax  

When issuing an estimated Tax Assessment, the Authority takes into account the available information to calculate the payable tax and refundable tax. If new relevant information emerges, the estimated tax assessment can be amended. The person concerned must be notified of any amendments within 10 days, allowing them to address any discrepancies. 

Information and Data in Tax Assessment 

• Role of the Executive Regulation  

The Executive Regulation, a subsidiary legislation to the Tax Procedures Law, provides detailed guidelines and instructions for implementing the law. It specifies the information and data that must be included in the tax assessment, ensuring uniformity and consistency in the assessment process. 

 

Topic 7: Transitional Rules under UAE Corporate Tax 

Transitional Rules offer instructions for moving from the old legal system to the new one. The provisions listed in the Transitional Rules must be implemented in order to make a smooth transition from the pre-UAE Corporate Tax Law system to the post-UAE Corporate Tax Law regime. 

Transitional Provisions of the UAE Corporate Tax Law 

According to the UAE Corporate Tax Law, there are the following transitional rules: 

For the purposes of the UAE Corporate Tax Law: Opening Balance Sheet  

• The closing balance sheet created for the purposes of financial reporting in accordance with the accounting standards will be the opening balance sheet of a Taxable Person. 
• The “Accounting Standards” that must be followed are those that are in effect in the United Arab Emirates on the final day of the fiscal year. 
• It is important to keep in mind that this Financial Year will end just before the first Tax Period commences. 

Arm’s Length Principle Application under UAE Corporate Tax Law 

• According to Chapter 10 of the UAE Corporate Tax Law’s transfer pricing regulations, the opening balance sheet must follow the arm’s length principle. This requirement is meant to prevent non-length arm’s agreements and transactions made before the introduction of corporate tax from having an impact on how Taxable Income is determined. 

Use of the Anti-Abuse Provisions 

• The anti-abuse provisions of Article 50 will apply to any transactions and agreements made on or after the date the Corporate Tax Law is published in the Official Gazette. 
• This is done to guarantee the effective implementation of the arm’s length principle and the smooth operation of transition rules for creating the opening balance of the financial statements. 
• Additionally, it permits the Authority to oppose any agreements made or transactions made by a Person prior to that Person becoming subject to corporate tax in cases where those agreements or transactions would later lead to excessive corporate tax advantages, benefits, or relief. 

Additional Transitional Provisions of the UAE Corporate Tax Law 

• On the Minister’s recommendation, the Cabinet may prescribe any additional transitional regulations for carrying out the provisions of the UAE Corporate Tax Law. 

Recent Developments  

Mof Decision on Transitional Rules regarding Adjustments toTaxable Income 

The recent Decision issued by the Ministry of Finance on UAE Corporate Tax Transitional Rules outlines the necessary adjustments to be applied to a Taxable Person’s Taxable Income in relation to losses or gains associated with different assets and liabilities.  

Adjustments to Taxable Income Relating to Gains on Immovable Property Acquired Before the First Tax Period 

1. Taxable persons have the option to adjust their taxable income for gains related to immovable property, provided certain requirements are met. 

1. The valuation of immovable property should be based on historical cost in the financial statements. 

1. If a qualifying immovable property is sold or transferred, the taxable person must make adjustments as specified in Clause 1 of this Article. 

1. The market value of the qualifying immovable property is determined by the relevant UAE government authority. 

1. Guidelines for calculating the excluded gain amount are provided in Clause 2(b) of the Article. 

Adjustments to Taxable Income Relating to Gains on Intangible Assets Earned Prior to the First Tax Period 

1. Taxable Persons can adjust their Taxable Income using the provisions outlined in Article 20(2)(i) and Article 61(1) of the Corporate Tax Law for gains on intangible assets. 

1. The intangible assets must meet specific requirements to be eligible for these adjustments. 

1. The Taxable Person is required to deduct the gain realized on the sale of the qualifying intangible asset, as determined by the rules described in Clause 3 of this Article. 

Adjustments to Taxable Income for Losses and Gains on Financial Assets and Financial Liabilities Owned Before the First Tax Period 

1. Taxable Persons can elect to adjust their Taxable Income under Article 20(2) and Article 61(1) of the Corporate Tax Law for gains and losses on financial assets and financial liabilities meeting certain criteria. 

1. The amount resulting from the sale of qualifying financial assets or financial liabilities at market value and their cost being equal to net book value should be excluded from the gain or loss. 

Ownership of Immovable Property, Intangible Assets, Financial Assets, and Financial Liabilities within Members of a Qualifying Group or Tax Group 

1. This article applies to immovable property, intangible assets, financial assets, and financial liabilities solely held by the Taxable Person and certain individuals/entities belonging to the same Qualifying Group or Tax Group. 

1. Non-Financial Transferred Assets and Liabilities refer to assets and liabilities that are not financial assets. 

1. Non-Qualifying Transfer pertains to transfers not covered by the Corporate Tax Law. 

Topic 8: Closing Provisions of the UAE Corporate Tax Law 

The closing provisions detail the supplementary part of legislation and address the miscellaneous aspects of legislation such as publication of the Act, administrative policies, delegation of powers, and so on. 

Delegation of Authority under the UAE Corporate Tax Law 

The Minister of the Corporate Tax Regime has authority under the UAE Corporate Tax Law. However, the legislation provides for the delegation of powers by the Minister to the Authority, in cases where the Minister deems appropriate.  

The delegation of authority as specified may either be: 

1. Full/ Complete Delegation of Powers 

1. Part Delegation of Powers 

Administrative Policies and Procedures under UAE Corporate Tax Law 

According to the UAE Corporate Tax Law, the Authority will decide the administrative policies, procedures, and processes pertaining to the compliances that a Person must adhere to. 

Additionally, Article 63 stipulates that the Authority shall decide on these administrative policies, practises, and processes after consulting with the Ministry. 

In accordance with the UAE Corporate Tax Law, cooperation between the Federal Tax Authority and the Government Authorities 

Governmental bodies are required to work with the Authority to support it in order to ensure the effective operation of the UAE’s Corporate Tax Law. It instructs the executive branch of government to: 

1. Assist the Authority in the efficient enforcement and administration of the UAE Corporate Tax Law; and  

1. Furnish any details which may include data, documentation, or any such information that the authority might need in the course of administering and enforcing the Corporate Tax Law.  

Revenue Sharing between the Federal Government and the Government of the respective Emirates under the UAE Corporate Tax Law 

This provision details the appropriation of Corporate Tax and any associated penalties collected from the UAE’s Corporate Tax regime. It states that:   

• Revenue Sharing: The revenues are to be shared collectively between the Federal Government and the Government of the respective Emirates.  
• Issue of a Federal Law: For revenue sharing, a federal law will be issued to deal with the matter specifying the sharing of revenues.  

Conflict between the terms of an International Agreement and the provisions of UAE Corporate Tax Law 

In the event of a conflict between the terms of any international agreement and those of the Corporate Tax Law, the terms of the international agreement will take precedence.  

Implementing the Decisions 

Clauses 1 and 2 provide that: 

1. The Cabinet 

1. The Minister, and  

1. The Authority  

may issue appropriate implementing decisions. They might be published to ensure that the Law’s provisions are applied correctly and efficiently.  

Cancellation of Conflicting Provisions in the UAE Corporate Tax Law  

In the event of a conflict, or inconsistency with any of the UAE Corporate Tax Law’s provisions, the Corporate Tax Law’s provisions will take precedence over those in other laws. 

Application to Tax Periods under UAE Corporate Tax Law 

A Tax Period is the time frame for which the taxpayer or other taxpaying individuals must file their Tax Return. The provision states that the UAE Corporate Tax Law will apply to Tax Periods starting on or after June 1, 2023.  

The UAE Corporate Tax Law’s Publication and Application 

• Publication: The UAE Corporate Tax Law will be published in the Official Gazette of the UAE Federal Government.  
• Application: After fifteen (15) days from the UAE’s Corporate Tax Law’s publication, the provisions will come into effect. 

The Corporate Tax Law’s provisions took effect on October 25, 2022, after it was published in the UAE Official Gazette on October 10, 2022. 

Issues and Solutions 

Issue: One potential problem with Article 48 is that it doesn’t specifically address instances in which a Taxable Person needs an extension to pay Corporate Tax or in which they might encounter difficulties doing so. 

Solution: The law should include clauses that permit Taxable Persons to request an extension of the payment deadline in specific circumstances to address this issue. The Authority could approve this extension on valid grounds such as unexpected financial challenges or unusual circumstances