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Corporate Tax Consultants in Dubai | Expert Tax Services

Advisory & Consulting

Corporate Tax Audit

Expert guidance for UAE corporate tax compliance and audit preparation. Ensure your business meets FTA regulations with our comprehensive tax services.

HomeVAT ServicesCorporate Tax Audit in UAE

Corporate Tax Audit in UAE

A corporate tax audit is a crucial process that ensures businesses comply with the corporate tax regulations set by the Federal Tax Authority (FTA). Companies operating in the UAE must be prepared for audits, as these reviews validate the accuracy of tax filings and financial records.

Mainland Companies

All UAE mainland businesses must comply with corporate tax regulations

Freezone Entities

Eligible freezone companies and foreign businesses with UAE-sourced income

Documentation Required

Proper financial records and tax reports must be maintained for 7 years

Non-Compliance Penalties

Companies may face fines, interest charges, or legal consequences

Purpose of UAE Corporate Tax Audit

The purpose of a UAE corporate tax audit is to assess whether a company has met its tax obligations correctly, ensuring proper documentation, timely tax payments, and adherence to tax regulations. The corporate tax audit in UAE applies to all eligible businesses, including mainland companies, certain freezone entities, and foreign businesses with UAE-sourced income.

Fundamentals of Corporate Tax

The corporate tax rate in UAE is set at 9% on taxable income exceeding AED 375,000, while businesses earning below this threshold are taxed at 0%. The implementation of corporate tax in UAE aligns the country’s tax system with global standards, enhancing transparency and business credibility.

Corporate tax applies to mainland businesses, eligible freezone companies, and foreign entities generating income within the UAE. However, some entities are exempt from corporate tax, including government organizations, extractive industries, NGOs, and public benefit organizations.

1
Corporate Tax Audits
Corporate tax audits in the UAE are formal evaluations conducted by the FTA to ensure businesses are complying with tax laws. These audits validate the accuracy of reported income and tax filings.
2
Audit Triggers and Selection
Businesses may be chosen for audit based on random selection, reporting inconsistencies, or high-risk activities such as international transactions or suspicious deductions.
3
Notification and Initiation
The audit begins when a business receives an official notice from the FTA. This notification outlines the audit scope, expected timelines, and initial documentation requirements.
4
Required Documentation
Companies must present a range of financial documents, including tax returns, invoices, contracts, and bank statements. These records help the FTA verify tax accuracy and compliance.
5
Outcomes & Consequences
If the FTA finds errors or non-compliance during the audit, the company may need to pay penalties, amend filings, or resolve disputes with supporting evidence. Non-compliance may lead to serious legal or financial consequences.

Compliance Requirements for Corporate Tax Audit

Businesses must adhere to strict corporate tax compliance regulations in the UAE. Maintaining accurate financial records, invoices, tax calculations, and transfer pricing documentation for at least seven years is mandatory. Transfer pricing regulations require businesses to follow the OECD-aligned arm’s length principle, ensuring that transactions between related entities are conducted at market value. Businesses must also file their corporate tax returns annually within nine months after the end of their financial year. Failure to meet deadlines can result in penalties and fines.

Corporate Tax Penalties for Non-Compliance

Non-compliance with UAE corporate tax audit regulations can result in significant penalties:

  • Late filing: AED 500–1,000 per month, which can accumulate over time and increase financial burden.
  • Underreporting taxable income: 14–40% of the unpaid tax, depending on the severity and intent behind the underreporting.
  • Failure to maintain records: Penalties of up to AED 50,000, which may be imposed on businesses that do not keep accurate tax records.
  • Failure to submit tax returns on time: Additional fines may be imposed for repeated delays.
  • Incorrect tax reporting: Providing inaccurate or misleading information may lead to penalties and scrutiny.
  • Corporate Tax Penalties: Hiding business dealings to evade taxes can lead to legal action.
  • Engaging in fraudulent tax activities: May face heavy fines, legal action, or criminal charges.
  • Non-payment of corporate tax liabilities: May result in further penalties and interest charges.
  • Repeated violations: May face harsher penalties, additional audits, and operational restrictions.
  • Legal consequences: May include audits, restrictions, or blacklisting from government contracts.

To avoid these penalties, businesses should ensure timely tax filings, accurate record-keeping, and compliance with FTA regulations. Seeking professional guidance can help companies stay ahead of compliance requirements and minimize financial risks. Understanding corporate tax penalties is crucial for businesses to ensure compliance and avoid financial risks.

Who Should Register for Corporate Tax in UAE?

The corporate tax in UAE applies to a wide range of businesses operating within the country. Understanding whether your company falls under the corporate tax framework is essential to ensuring compliance and avoiding penalties.

Mainland UAE Companies

All businesses operating within the mainland UAE must register and comply with corporate tax regulations, including SMEs and large enterprises.

Eligible Freezone Businesses

Some freezone entities qualify for 0% tax, but must still register with the FTA and meet compliance under the substance-over-form rule.

Foreign Entities with UAE Income

Foreign companies with UAE-sourced income must register if they meet the threshold—this includes branches, reps, and non-resident entities.

LLCs & Partnerships

LLCs, joint ventures, and partnerships must register for corporate tax if net taxable income exceeds the threshold.

How to Register for Corporate Tax in UAE

Registering for corporate tax in UAE is a crucial step for businesses to remain compliant with the Federal Tax Authority (FTA) regulations. Companies must follow a structured process to ensure their tax obligations are met efficiently and on time.

1

Create an FTA e-Services Account:

  • Businesses must first register for an FTA e-Services account by visiting the Federal Tax Authority (FTA) portal.
  • This account will be used for tax registration, filing returns, and handling all tax-related communications with the authorities.
2

Provide Business Details:

  • Trade license details (license number, issuing authority, and validity)
  • Ownership details (including UAE and foreign shareholders, if applicable)
  • Authorized signatory details
  • Company name (English & Arabic)
  • Business activities and operational structure
3

Upload Required Documents:

  • Memorandum of Association (MoA) and Articles of Association (AoA)
  • Financial statements (latest audited records, if applicable)
  • Passport copies and Emirates ID of the authorized signatory
  • Taxpayer identification details
  • Bank account details
4

Submit the Registration Form:

  • Once all details and documents are correctly provided, businesses can submit their corporate tax registration application via the FTA portal.
  • The FTA will review the application, verify the submitted documents, and approve the tax registration request.
  • If any issues arise, the FTA may request additional information or clarifications before granting approval.

Why Choose Young and Right

Expert guidance for UAE corporate tax compliance and audit preparation with seasoned professionals

At Young and Right, we specialize in providing expert guidance to businesses navigating the complexities of corporate tax audits in the UAE. With constantly evolving tax regulations and compliance requirements set by the Federal Tax Authority (FTA), companies must stay up to date to avoid penalties and legal complications. Our team of seasoned tax professionals ensures that businesses comply with corporate tax laws, maintain accurate financial records, and prepare for potential tax audits.
Audit Preparation
  • Internal tax reviews to assess compliance risks
  • Financial statements and tax records evaluation
  • Discrepancy identification and resolution
  • Transfer pricing documentation support
  • Seven-year record maintenance guidance
Compliance Support
  • Corporate tax return preparation and filing
  • Transfer pricing reports guidance
  • Tax calculations and record-keeping support
  • VAT and indirect tax obligations assistance
  • Regular updates on tax law changes
Dispute Resolution & Audit Representation
  • Expert representation during FTA tax audits
  • Tax disputes and penalties resolution
  • Tax penalty appeals guidance
  • Professional FTA communication management
  • Incorrect assessment challenging
Tax Advisory & Strategic Planning
  • Tax-efficient structuring solutions
  • Corporate tax grouping advisory
  • Freezone substance-over-form compliance
  • E-commerce tax optimization
  • Digital business tax strategies

Proactive Approach

Being proactive in tax compliance helps businesses avoid penalties and ensures smooth financial operations.

Seasoned Professionals

Our team of seasoned tax professionals ensures businesses comply with corporate tax laws.

Strategic Solutions

Tailored advice and strategic planning to optimize tax efficiency while maintaining compliance.

FAQ

Required documents include trade license copies, Memorandum of Association (MoA), Articles of Association (AoA), financial statements, taxpayer identification details, and bank account details.
The corporate tax rate is 9% for taxable income exceeding AED 375,000, while businesses earning below this amount are taxed at 0%.
Young and Right provides expert services such as audit preparation, compliance support, dispute resolution, transfer pricing advisory, corporate tax registration assistance, and strategic tax planning to help businesses remain compliant and avoid penalties.
Yes! We follow strict data protection policies to keep your business information secure and confidential.
The company may face financial penalties, interest charges, further audits, or even legal consequences such as restrictions on business operations
Yes, certain free zone entities may qualify for a 0% corporate tax rate if they meet the substance-over-form rule and other FTA regulations.
Yes, exemptions apply to government entities, extractive businesses, non-extractive natural resource businesses, qualifying public benefit entities, qualifying investment funds, pension or social security funds, and wholly owned UAE subsidiaries of exempt entities.
The first corporate tax year aligns with your company’s financial year starting on or after 1 June 2023. For example, if your financial year begins on 1 July 2023 and ends on 30 June 2024, your first corporate tax year would be from 1 July 2023 to 30 June 2024.
Free zone companies can benefit from a 0% corporate tax rate if they meet certain conditions, such as maintaining adequate substance, deriving qualifying income, and complying with transfer pricing rules..

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