FTA urges companies to register for corporate tax before July 31 or face AED 10,000 fine

The Federal Tax Authority (FTA) is urging businesses and certain exempt entities in the UAE to submit their Corporate Tax registration applications without delay. The authority emphasized that companies filing their first tax return through the ‘EmaraTax’ digital platform by the deadline could benefit from the Penalty Waiver Initiative for Late Corporate Tax Registration.

In a statement released this week, the FTA revealed that more than 33,900 entities have already taken advantage of the initiative, which offers relief to those who missed the initial registration deadline.

The final deadline to qualify for the waiver is Thursday, July 31, 2025, for most taxpayers whose first tax period follows the calendar year, from January 1 to December 31, 2024. To be eligible, registrants must complete both their registration and file their first tax return or annual declaration via EmaraTax by the end of July.

The FTA warned that failure to meet this deadline would result in a late registration penalty of AED 10,000. It clarified that to be exempt from this penalty, the tax return or declaration must be filed within seven months from the end of the first tax period or financial year—an exception to the usual nine-month timeframe.

The Penalty Waiver Initiative applies exclusively to the first tax period of a taxable person or an exempt person who is legally required to register with the FTA. The authority noted that no additional application for reconsideration or penalty waiver is necessary, as eligibility will be assessed automatically based on timely compliance.

The FTA has also issued a public clarification outlining the details of the initiative. The document explains the waiver conditions and provides examples to illustrate different scenarios. It also outlines the mechanism for refunding the AED 10,000 penalty in cases where it has already been paid. In such cases, the amount will be automatically credited to the taxpayer’s EmaraTax account and may be used to offset other tax obligations or withdrawn by submitting a refund request.

Through this initiative, the FTA aims to support businesses in meeting their tax obligations while promoting compliance under the UAE’s newly implemented Corporate Tax framework.