The UAE Ministry of Finance has announced a significant update concerning corporate tax regulations, underscoring the importance of timely compliance for businesses operating within the country. According to the newly issued Cabinet Decision No. 10 of 2024, companies that fail to register for UAE Corporate Tax within the specified deadlines will face an administrative penalty of AED 10,000.
This amendment, effective from March 1, 2024, modifies the existing schedule of violations and penalties outlined in Cabinet Decision No. 75 of 2023, which governs the enforcement of Federal Decree-Law No. 47 of 2022 on the taxation of corporations and businesses.
Emphasis on Compliance
The Ministry of Finance has emphasized that the AED 10,000 penalty is designed to encourage businesses to adhere strictly to the tax registration timelines set by the Federal Tax Authority (FTA). By aligning this penalty with those for late registration in excise tax and value-added tax (VAT), the government aims to reinforce the importance of timely compliance across all forms of taxation.
Key Takeaways for Businesses
- Penalty Amount: AED 10,000 for failing to register for UAE Corporate Tax within the specified deadlines.
- Effective Date: The new penalty regulation will be enforced starting March 1, 2024.
- Alignment with Other Taxes: The penalty amount is consistent with penalties for late registration in excise tax and VAT, indicating a unified approach to tax compliance.
Businesses are urged to ensure they meet all registration requirements within the deadlines to avoid these penalties. As the UAE continues to evolve its tax framework, maintaining compliance will be crucial for companies to operate smoothly and avoid unnecessary fines.
