UAE Businesses Embrace Corporate Tax Compliance Ahead of 2025 Deadline

As the deadline for corporate tax compliance approaches, over 640,000 businesses in the UAE have registered for corporate tax, marking a significant milestone. This surge comes ahead of the September 2025 deadline for entities whose financial years conclude on December 31, 2024.

High Compliance Rates Reflect Awareness and Preparedness

The Federal Tax Authority (FTA) has reported that these registration numbers indicate compliance rates that surpass international standards. UAE businesses are demonstrating a strong understanding of the new tax framework, with timely filings and payments becoming the norm. Khalid Ali Al Bustani, the Director-General of the FTA, emphasized that this uptick in registrations showcases the effectiveness of the UAE’s legislative and procedural tax framework. This framework is underpinned by advanced digital compliance systems that align with global best practices.

EmaraTax: A Digital Solution for Tax Compliance

Al Bustani highlighted the role of the EmaraTax platform, which has efficiently processed hundreds of thousands of tax returns and declarations. This platform offers businesses 24/7 digital services, ensuring speed and transparency in tax compliance. Additionally, the FTA’s call center has been instrumental in managing thousands of inquiries daily, providing immediate assistance during peak periods.

The UAE’s business-friendly tax environment fosters voluntary compliance, supported by various government initiatives. Notably, a Cabinet decision allows certain corporate taxpayers to avoid administrative penalties for late registration, provided they submit their first tax return within seven months of their initial tax period.

Extended Deadlines and Grace Periods for New Businesses

To facilitate a smooth transition into the new tax regime, the FTA has extended filing and payment deadlines to December 31, 2024, for companies established on or after June 1, 2023, whose first tax period ends on or before February 29, 2024. Furthermore, the Zakat, Tax and Customs Authority (ZATCA) has introduced a grace period for registrants who delayed updating their tax records between January 1, 2024, and March 31, 2025, allowing them to make necessary amendments without incurring penalties.

These measures reflect the FTA’s commitment to supporting the business community through practical compliance facilitation and ongoing engagement.

Continuous Improvements to EmaraTax

Al Bustani attributed the high compliance rates to the FTA’s continuous enhancements to the EmaraTax platform. These improvements streamline registration and filing procedures, aligning with the UAE’s Zero Bureaucracy initiative. By reducing administrative burdens, the FTA is not only simplifying compliance processes but also fostering an environment conducive to business growth.

Nationwide Awareness and Education Initiatives

Since the beginning of 2024, the FTA has launched a comprehensive two-year awareness campaign. This initiative includes over 154 sessions—both virtual and in-person—drawing participation from around 48,000 individuals across the Emirates. Through various channels such as the Taxpayer Support Centre, Live Tax Connect, SMS reminders, and social media outreach, the FTA has kept businesses informed and engaged.

Additionally, the FTA regularly publishes guides, videos, and infographics on its website, ensuring that taxpayers can easily navigate and comply with corporate tax regulations. These educational efforts have been crucial in achieving high participation rates among businesses.

In summary, the proactive measures taken by the UAE government and the FTA reflect a robust commitment to fostering a compliant and informed business environment as the corporate tax landscape evolves.