UAE Tax Penalty Waiver Helps 33,900 Companies

More than 33,900 Companies Exempted from Late Corporate Tax Registration Penalties in the UAE
The Federal Tax Authority (FTA) of the United Arab Emirates announced that so far, over 33,900 companies have benefited from the waiver of penalties related to delayed corporate tax registration. The authority simultaneously confirmed that for most affected taxpayers, the last day to take advantage of this allowance is July 31 (Thursday).
Objective of the Exemption: A One-time Compliance Opportunity
The initiative, known as the Penalty Waiver Initiative, aims to support businesses whose first corporate tax period spans from January 1 to December 31, 2024. The FTA provides them the opportunity to register for corporate tax without paying the Dh10,000 penalty if they meet the stipulated conditions before the end of the month.
This one-time exemption applies exclusively to the first tax period, requiring those affected to act urgently.
Who is Eligible for the Exemption?
The exemption applies to:
those operating as taxable businesses,
or those exempt from tax payment but are legally required to register.
The FTA highlighted that an entity is exempt from the penalty only if:
it submits its registration application in the EmaraTax system by July 31,
along with its first tax return or declaration within seven months after the end of the tax period (not the usual nine months, as in subsequent periods).
What Should Companies Be Aware Of?
The FTA warned that companies missing the deadline will no longer have access to the penalty exemption and will automatically incur a Dh10,000 late penalty. Therefore, it is recommended that every business promptly verify:
its registration status,
its tax obligation,
and whether it can submit the first corporate tax return on time.
The Role of the Digital EmaraTax Platform
The tax authority emphasized that all registration and reporting processes must be conducted through the digital EmaraTax platform. This unified system allows taxpayers to fulfill their obligations paperlessly, quickly, and accurately.
The platform is suitable for managing other types of taxes, such as VAT, and plays a crucial role in implementing the UAE's digital tax reform.
Summary
A crucial deadline is approaching for businesses operating in the UAE: July 31 is the last day they can register for corporate tax without penalties. More than 33,900 companies have already taken advantage of this option, and the FTA urges all unregistered businesses to act swiftly. Missing the deadline could result in significant financial sanctions, even though obligations could be fulfilled through a simple, digital platform.
(The source of the article is a Federal Tax Authority statement.)
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