The corporate tax period in UAE is the accounting period for which a taxable person must calculate taxable income and file a corporate tax return. The UAE’s corporate tax regime applies to financial years beginning on or after 1 June 2023. Taxable persons must file a corporate tax return and pay any corporate tax due within nine months from the end of the relevant tax period. The standard corporate tax rate is zero percent on taxable income up to AED 375,000 and nine percent on taxable income above AED 375,000. This blog explains the Corporate Tax Period in UAE and how businesses can stay compliant with the FTA corporate tax regulations.
What does “corporate tax period in UAE” mean?
The corporate tax period in UAE is the fiscal interval for a company or other taxable person during which revenues, expenses and taxable income are determined for corporate tax purposes. The corporate tax period in UAE may be the company’s financial year or another period approved by the Federal Tax Authority. For natural persons carrying on business, the tax period is the Gregorian calendar year, that is from 1 January to 31 December. For juridical persons the tax period normally aligns with the entity’s financial year. These definitions come from official guidance and FTA public clarifications.
When a business started before 1 June 2023 but its financial year overlaps the law’s start date, the first tax period has specific rules. For example, if your financial year runs from 1 September to 31 August, the first tax period under the UAE corporate tax law would be 1 September 2023 to 31 August 2024. The Federal Tax Authority has clarified how first tax periods are determined to avoid confusion for businesses with non-calendar fiscal years
The date range that constitutes the corporate tax period in UAE fixes three operational requirements. First, it sets the registration triggers and deadlines for the Federal Tax Authority. Second, it fixes filing and payment deadlines because the nine-month filing rule is measured from the end of the corporate tax period. Third, it establishes the timeframe for which audits, transfer pricing documentation and record retention must be prepared.
The legal base and timeline you must plan around
The UAE Corporate Tax regime is based on Federal Decree-Law No. 47 of 2022 and is implemented by the Ministry of Finance and the Federal Tax Authority. Corporate tax applies to financial years that begin on or after 1 June 2023. The law establishes taxable persons, tax periods, taxable income, rates and filing obligations. The Federal Tax Authority issues detailed public clarifications and guidance that set registration timelines and procedural rules. One concrete administrative measure is Decision No. 3 of 2024, which clarified registration timelines for corporate tax and took effect from 1 March 2024. For large multinationals, a domestic minimum top-up tax (15 percent) was introduced in line with the OECD global minimum tax rules with implementation dates and thresholds that the Ministry of Finance announced.
Tax rates and thresholds you must budget for
For the majority of UAE businesses, taxable income up to AED 375,000 is subject to a zero percent rate and taxable income above AED 375,000 is taxed at nine percent. Free zone entities that qualify under the qualifying free zone person rules may apply a zero percent rate on qualifying income, subject to meeting conditions set by the law and the FTA. For very large multinationals that fall under the OECD Pillar Two rules, the UAE will apply a domestic minimum top-up tax of 15 percent to bring the effective rate to the global minimum where necessary.
Filing deadlines and the corporate tax period in UAE
A taxable person must file a corporate tax return for each tax period within nine months from the end of the relevant tax period. The same nine-month period generally applies for payment of tax due in that return. For example, if a company’s tax period ends on 31 December 2024, the corporate tax return and payment must be completed by 30 September 2025. The nine-month rule is a fixed calendar requirement and it defines your months deadline for closing financials, finalizing tax adjustments, preparing transfer pricing disclosures and arranging payment. The Ministry of Finance and the FTA provide illustrative filing and payment schedules to help entities map their deadlines.
Corporate tax compliance
For group tax planning, having the same accounting period across all companies makes corporate tax compliance easier. If that is not possible, the group must keep proper records and adjustments to match tax positions across different corporate tax periods. For group tax planning, synchronizing accounting periods simplifies corporate tax compliance, but where synchronization is not possible the group must manage the mechanics and documentation that reconcile tax positions across distinct corporate tax periods.
Record keeping and documentary requirements for each corporate tax period
Taxable persons must retain records and documentation which substantiate taxable income, deductions and any exemptions or credits claimed for the corporate tax period. The FTA guidance requires retention of records for a set period and expects that records are maintained in a format that can be inspected or provided on request. Practically this means that for each corporate tax period you should produce reconciled general ledgers, fixed asset registers, depreciation schedules, revenue recognition working papers, intercompany agreements and transfer pricing studies if applicable. A robust records policy reduces the time and cost of producing a return at the end of a tax period and lowers audit risk.
Free zone companies and the corporate tax period in UAE
Free zone companies may be eligible for preferential treatment, including a zero percent rate on qualifying income, but they must meet the qualifying conditions prescribed by law and the Federal Tax Authority. The corporate tax period in UAE for free zone entities is the same concept as for other taxable persons, and free zone persons must still register, file returns and retain records for each tax period. Whether a free zone entity receives preferential treatment for a tax period depends on meeting substance, reporting and transactional conditions that must be supported with documentation for that period. Free zone status does not remove the need for corporate tax compliance.
Natural persons and their corporate tax period in UAE
A natural person who runs a business has the Gregorian calendar year as their tax period for corporate tax purposes. Natural persons are required to register for corporate tax once their total turnover from business activities in a Gregorian calendar year exceeds AED 1,000,000. For natural persons who become taxable, the nine-month filing rule applies after the end of the Gregorian year tax period. The FTA has published bulletins specifically aimed at natural persons that explain how the tax period and filing obligations operate in practice.
Penalties and enforcement tied to the tax period
The FTA has a schedule of penalties for late registration, late filing, late payment and for producing inaccurate returns. Because deadlines are defined relative to the corporate tax period in UAE, missing the end of the nine-month filing window directly triggers penalties for late filing and late payment. The FTA’s public clarifications and legislative instruments specify the amounts and the conditions for mitigation in certain transitional circumstances. Companies should treat the end of each corporate tax period as a firm operational milestone and build internal checks to prevent penalty exposure.
Group reporting and consolidation considerations across tax periods
For group tax planning, having the same accounting period across all companies makes corporate tax compliance easier. If that is not possible, the group must keep proper records and adjustments to match tax positions across different corporate tax periods. For group tax planning, synchronizing accounting periods simplifies corporate tax compliance, but where synchronization is not possible the group must manage the mechanics and documentation that reconcile tax positions across distinct corporate tax periods.
Penalty mitigation and voluntary disclosure within a tax period
Where errors are found in a corporate tax return for a tax period, a voluntary disclosure to the FTA may reduce penalties compared to a discovery through an audit. The FTA’s administrative practice and penalty framework treat proactive corrections more favorably. This means that if an entity identifies an error in a filed return for any corporate tax period in UAE, it should prioritize correction and disclosure while preserving clear calculations of the corrected taxable income. The compliance benefit of early disclosure improves the overall corporate tax compliance posture.
Common mistakes companies make during their tax periods
Companies often underestimate how long it takes to collect documentation, confirm transfer pricing positions, and reconcile intercompany balances. These delays compress the time available before the nine-month filing deadline for the corporate tax period in UAE. Another common error is inadequate retention of supporting documents or poor documentation of free zone qualifying conditions. Finally, failing to align accounting close calendars to the tax period causes avoidable restatements. Correcting these problems requires process discipline and early engagement with the FTA or advisors where questions exist.
Closing thoughts
Build a calendar that ties financial close to tax work, assign clear ownership for each task, and automate calculations wherever possible. Ensure documentation is filed contemporaneously so that at the end of the tax period compiling the return is a verification exercise rather than a reconstruction.
FAQ’s
How long is a tax period for an individual running a business?
A natural person uses the calendar year, from 1 January to 31 December, as their tax period.
How do I find my first corporate tax period?
If your financial year includes 1 June 2023, that financial year is your first tax period; if it starts after 1 June 2023, the year that starts then is your first tax period.
What are the corporate tax rates in the UAE?
Taxable income up to AED 375,000 is taxed at 0%, and taxable income above AED 375,000 is taxed at 9%; very large multinationals may face a 15% top-up under global rules.
When must I file the corporate tax return?
A company must file its corporate tax return within nine months after the end of its tax period.
When do I have to pay the tax?
You must pay any tax shown in the return by the same nine-month deadline following the tax period end.
Do free zone companies pay corporate tax?
Some free zone companies that meet specific conditions can get a 0% rate on qualifying income, but they still must register and file returns.
About the Author:
Sana Fatima
Sana Fatima is the author of this piece of writing and an aspiring Chartered Accountant. She possesses practical knowledge in finance, accounting, taxation, audit, and business law dynamics. She uses her skills to translate difficult tax and accounting subjects into comprehensive materials. Her writing helps business teams and non-specialists understand the rules which govern their work.
