FTA issues decision postponing deadlines for corporate tax return filing, payment for specific tax periods

ABU DHABI (WAM)

The Federal Tax Authority (FTA) announced the postponement of the deadline to file a Tax Return and settle Corporate Tax Payable to December 31, 2024, applicable to short Tax Periods ending on or before February 29, 2024.

The FTA issued Decision No. 7 of 2024 on the Postponement of the Deadline to File a Tax Return and Settle the Corporate Tax Payable for Certain Tax Periods for the purposes of Federal Decree-Law No. 47 of 2022 on the Taxation of Corporations and Businesses and its amendments.

Director-General of the FTA, Khaled Ali Al Bustani, emphasised the FTA's dedication to supporting all taxpayers, stating, "We are deeply committed to taking proactive measures that benefit taxpayers. Recognising the potential challenges faced by businesses with a first Corporate Tax period shorter than a year, we have postponed the deadline by which certain taxpayers must file their Tax Return and settle their Corporate Tax Payable, to assist taxpayers in meeting their Corporate Tax obligations, especially for new businesses throughout their first Tax Periods."

"Our goal is to encourage timely and accurate tax filings by offering a reasonable timeframe for taxpayers to fulfil their obligations, thereby alleviating undue pressure and potential administrative penalties. This Decision reflects our ongoing commitment to fostering a supportive and equitable tax environment in the UAE that encourages timely compliance while minimising tax burdens," he added.

The FTA’s decision states that the due date for filing the Corporate Tax Return for Taxable Persons with a short Tax Period that ends on or before February 29, 2024 (e.g. those ending on December 31, 2023, January 31, 2024 or February 29, 2024) is postponed to December 31, 2024, and the Corporate Tax Payable for these Tax Periods may now also be settled with the FTA by December 31, 2024.

The Decision is aimed at Taxable Persons incorporated, established or recognised on or after June 1, 2023 that have a financial year ending on or before February 29, 2024, which resulted in a first Tax Period that is shorter than the standard 12-month duration.

For example, if a company was incorporated on June 10, 2023 and had a financial year from January 1 to December 31, its first Tax Period would be from June 10, 2023 to December 31, 2023.

Prior to the issuance of FTA Decision No. 7 of 2024, it would have had to submit its Tax Return and settle the Corporate Tax Payable by September 30, 2024, in accordance with the provisions of the Corporate Tax Law.

However, based on FTA Decision No. 7 of 2024, the deadline to file their Tax Return and settle the Corporate Tax Payable is now December 31, 2024.