As the UAE transitions into a new era of tax compliance under the Corporate Tax (CT) regime, it’s critical for businesses to understand their legal obligations—regardless of their profitability. One of the most important aspects of this new framework is that every taxable person is required to file a Corporate Tax return, even if the business has incurred a loss or has generated no revenue during the financial year.
Mandatory Filing – No Exceptions Based on Profitability
The UAE Corporate Tax Law (Federal Decree-Law No. 47 of 2022) clearly stipulates that all Taxable Persons must file a Corporate Tax return annually within nine months from the end of their relevant financial period.
This obligation applies to all types of business entities, including:
Companies that made a loss during the period.
Businesses that earned no revenue.
Free Zone entities (including Qualifying Free Zone Persons).
Dormant companies holding assets or licenses.
There is no exemption from filing simply because the business is not making a profit or hasn’t started operations.
why Filing Is Still Required in Loss or Zero-Revenue Scenarios
To establish continuity and compliance: Filing ensures your business remains compliant and avoids being flagged by the Federal Tax Authority (FTA) for non-compliance.
To carry forward tax losses: If you’ve incurred a loss, filing the return enables you to carry forward those losses to offset future taxable profits, reducing future tax liability.
To meet legal obligations: Non-filing can lead to administrative penalties, regardless of your income level.
To maintain license renewals and bank relationships: Several licensing authorities and financial institutions may require proof of tax filing for renewals and due diligence processes.
Risk of Non-Compliance
Failing to file a CT return within the deadline could lead to penalties starting from AED 500, increasing with delay. Moreover, consistent non-compliance may affect your business credibility and raise red flags with the FTA.
Example Timeline:
For a company with a financial year ending 31 December 2024, the Corporate Tax return must be submitted on or before 30 September 2025—irrespective of the profit/loss status.
What Should You File?
Even if you had no operations or income, you are expected to:
File a CT return disclosing your financials (even if zero),
Maintain proper financial records, and
Submit any other declarations required (e.g., for exempt entities or Qualifying Free Zone Persons).