Stay ahead of VAT and Corporate Tax regulations with this practical guide
The UAE has introduced robust tax regulations to strengthen financial transparency. Whether you’re a business owner, freelancer, or investor, here’s your essential tax compliance checklist with deadlines to avoid penalties and ensure smooth operations:
✅ 1. Trade License & Business Information
Keep your trade license active and renewed annually.
Update FTA records within 20 business days if there’s any change in:
Legal name
Business activity
Address
Ownership or legal structure
Emirates ID or passport details
- Any other renewal / update in the business or business owners / managers information
Penalty for non-compliance: AED 5,000
✅ 2. VAT Compliance
Register for VAT within 30 days if your taxable turnover exceeds AED 375,000.
File VAT returns quarterly or monthly based on your VAT certificate.
VAT return due: 28th of the following month after tax period ends
Issue valid tax invoices for all taxable sales.
Maintain VAT-compliant books and reconcile input/output VAT monthly.
Deregister if turnover drops below AED 187,500 or business ceases.
VAT deregistration must be filed within 20 business days of eligibility.
✅ 3. Corporate Tax Compliance
Corporate Tax registration is mandatory for all UAE businesses (including freelancers if revenue is more than AED 1 million in a calendar year).
Deadline: Within 3 months from the date of trade license issuance
File Corporate Tax Return within 9 months from the end of your financial year.
Example: If year ends on 31 December 2024 → return due by 30 September 2025
Prepare and retain audited financial statements (required for companies with revenue > AED 50M).
Disclose related party and connected person transactions if total exceeds AED 500,000 annually.
✅ 4. Bookkeeping & Record Retention
Keep accounting records e.g. invoices, delivery notes, communications, VAT documents, and tax returns for at least 7 years.
Ensure your accounting system is FTA-compliant and audit-ready.
✅ Penalties to Watch For:
| Non-Compliance Area | Penalty Amount |
|---|---|
| Late VAT return filing | AED 1,000 – AED 2,000 |
| Failure to update FTA records | AED 5,000 |
| Delay in corporate tax registration | AED 10,000 |
| Improper record keeping | AED 10,000+ |
📝 Final Tip
Regularly reviewing your tax obligations and deadlines can save you from costly penalties. Consider conducting quarterly internal reviews or engaging a professional to ensure complete compliance.
