Do you know what documents are needed for CT Registration and filing returns in the UAE? Before we talk about the paperwork, it’s important to first understand what CT Registration and filing returns means. On January 31, 2022, the UAE Government announced that corporate tax would be applied to business profits. This tax started for financial periods that began on or after June 1, 2023.
The UAE was known for being a tax-free zone for many years. But to follow the global tax rules set by the OECD, the country introduced changes. These rules, called Pillar Two under the Base Erosion and Profit Shifting (BEPS) project, make sure businesses pay a minimum tax rate. To meet these standards, the UAE applied a 9% corporate tax rate on business profits.
To follow this tax law, businesses must prepare certain documents. This article explains the financial records needed for CT Registration and filing returns.
What Documents Are Needed for CT Registration and Filing?
To meet tax rules in the UAE, businesses must keep financial records that match the information they report in their tax returns. These records should be ready to show the Federal Tax Authority (FTA) when asked. Even if a business qualifies for a tax exemption, it still needs to keep records to prove this.
It is very important for businesses to have the correct documents ready for CT Registration and filing returns. Both tax registration and payments are done online. Here are the main documents businesses need:
- Copies of active trade licenses (must not be expired).
- Passport copies of the business owners or partners (must be valid).
- Emirates ID copies for the owners or partners (must also be valid).
- A Power of Attorney (POA) or Memorandum of Association (MOA).
- Contact details for the business owner (mobile number and email).
- Full company contact details (address and P.O. Box).
- Annual financial audit reports.
Important Rules for Keeping Financial Records Under CT
Even if a business does not have to pay taxes, it must keep records that prove its exemption. These records should be kept for at least seven years after the tax period ends. A group of companies, called a tax group, cannot keep shared financial records unless all companies are UAE-resident entities that form an official tax group.
Only certain businesses, listed by the Ministry, are required to keep audited financial statements. If the FTA asks, these businesses must submit their financial statements, records, and tax returns.
How to File CT Returns in the UAE
For each tax period, businesses must file one corporate tax return along with any required documents to the FTA. Businesses in the UAE do not have to make advance payments or submit provisional tax returns for CT Registration and filing returns. This makes the process easier for companies.
The deadline to submit tax returns and supporting documents is nine months after the tax period ends.
Timeline for CT Registration and Returns
The process for CT Registration and filing returns began in June 2023. The Ministry of Finance set the deadlines clearly. Businesses with financial years from June 1 to May 31 have 26 months to file their tax returns. Businesses with financial years from January 1 to December 31 have 33 months to file their tax returns and make the payments.
It is important for businesses to register and pay taxes before the deadline to avoid penalties.
Steps for Completing CT Registration and Filing Returns
Businesses can complete CT Registration and filing returns online. The FTA introduced the EmaraTax platform to make this process easier. The platform was launched to improve the tax system in the UAE. EmaraTax opened for selected businesses to register for corporate tax until June 2023. To learn more, visit the article: “Federal Tax Authority Opens Pre-Registration for Corporate Tax.
Why Accurate Financial Records Are Important for CT Returns
Keeping accurate financial records is important for CT Registration and filing returns. Here’s why:
- Following the Law: UAE tax laws require businesses to keep proper financial records. If they don’t, they could face penalties or legal trouble.
- Correct Tax Payments: Accurate financial records help businesses calculate taxable income the right way. This avoids paying too much or too little tax, which can lead to fines.
- Clear Business Operations: Good records show how a business is doing. Investors, lenders, and government officials use these records to check a company’s financial health.
- Smarter Business Decisions: When businesses keep good records, they can make better choices. They can plan new projects, find money problems, and make forecasts.
How Mubarak Al Katbi Can Help with CT Filing and Records
If your business is in a UAE free zone and you want to qualify for the 0% corporate tax rate, your financial statements must be audited. Mubarak Al Katbi provides auditing services to help businesses meet the needed standards in free zones.
For businesses outside free zones, the rules might be different. But free zone businesses must follow strict auditing requirements. Mubarak Al Katbi gives expert advice and support, making sure your records are complete and follow the rules.
Contact Mubarak Al Katbi today to see how we can help with CT Registration and filing returns, financial auditing, and staying tax-compliant.
