Under Federal Decree-Law No. 47 of 2022, businesses are required to register for corporate tax. However, small businesses with an annual income below AED 3 million may qualify for Small Business Relief.

Corporate Tax Rates for Small Businesses

0% for the first AED 375,000 of taxable income.
9% for the taxable income exceeding AED 375,000.
0% for those businesses that will qualify under the Small Business Relief program.

Corporate Tax Registration Guide for Small Businesses in the UAE

Step 1: Collect Required Documents

Businesses are required to provide the following documents:

Trade License – if applicable;
Copies of the Emirates ID and the Passport of the owner;
MOA, in the case of businesses that are already registered;
Statements of financial matters or revenues achieved;
Lease agreement or Ejari, whichever is applicable.

Step 2: FTA Portal – Corporate Tax Registration

FTA e-Services Portal.
Log in/register for an account.
Click on Corporate Tax Registration.
Business details should mention the trade license no, legal form, and also other financial info.
Upload the Document and submit as applicable

Small Business Relief: 0% Corporate Tax for Eligible Businesses

The Small Business Relief (SBR) scheme will enable businesses that earn revenues below AED 3 million per year to apply for a 0% corporate tax rate until 31 December 2026.

Eligibility Criteria for Small Business Relief

The annual revenue should not exceed AED 3 million.
The business should be a UAE resident person.
Not a qualifying free zone person
Has to meet FTA compliance requirements

Organizations that opt for Small Business Relief are supposed to register for corporate tax and file returns, nevertheless.

Deadline of Corporate Taxation Registration for Small Businesses in the UAE

All small businesses shall register for corporate tax based on the month of their license issuance:

License Issuance Month	Registration Deadline
January – February	31 May 2024
March – April	30 June 2024
May	31 July 2024
June	31 August 2024
July	30 September 2024
August – September	31 October 2024
October – November	30 November 2024
December	31 December 2024

However, for the small businesses incorporated on or after 1st March 2024, three months from the date of their incorporation will be the due date for registration.

UAE Corporate Tax Registration Fee for Small Business

The FTA does not charge any kind of registration fee for corporate tax.

Penalties for Late or Non-Registration

Failure to register with the FTA before the deadline results in:

AED 10,000 penalty for late registration.
Additional penalties for late filing of tax returns.
Legal implications if one fails to comply.

SMEs should, therefore, file their registration and maintain books of accounts on time to avoid such penalties.

Why Small Businesses Should Register for Corporate Tax Early?

Avoid Penalties – Late registration leads to fines.
Ensure Compliance – UAE tax laws require all businesses to register.
It allows businesses to apply for eligibility in the Small Business Relief: exemption of 0% of the tax.
Ease in Financial Planning: Proper tax registration helps businesses manage finances.

FAQs

Are UAE Small Businesses to Be Registered for Corporate Tax?

Yes, all sole traders, freelancers, and small businesses in the UAE will need to register for corporate tax regardless of their income level. Nonetheless, if their income for a year does not exceed AED 3 million, they can qualify for Small Business Relief (SBR) under which they will be charged 0% corporate tax until 31 December 2026.

What Are the UAE Corporate Tax Rates for Small Businesses?

UAE corporate tax rates are:

0% on taxable income of up to AED 375,000
9% on taxable income over AED 375,000
0% for qualifying businesses under the Small Business Relief program

Even if a small business does not have to pay any tax, it will still need to be registered with the Federal Tax Authority (FTA).

What Are the Small Business Corporate Tax Registration Documents Required?

Trade License (if needed).
Photocopies of the Owner’s Emirates ID and Passport.
Memorandum of Association (MOA) or business contract.
Revenue accounts or finance accounts.
Lease contract or Ejari (if necessary).

What If a Small Business Fails to Get Registered for Corporate Tax Within the Stipulated Period?

Failure to register within the FTA timeline attracts:

AED 10,000 penalty for late registration.
Late filing return penalty.
Default legal penalty.

What Is SBR, and How Do I Get Registered?

The Small Business Relief program provides relief for small businesses with an annual income of AED 3 million or less, providing them with the opportunity to apply for a 0% company tax rate until 31 December 2026. To register:

Register for corporate tax through the FTA portal.
File annual taxation returns, even if there is no payable tax.
Report SBR eligibility on the tax return.

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