What the Corporate Tax penalty waiver actually covers
Businesses that registered for Corporate Tax after their registration deadline were issued a fixed AED 10,000 administrative penalty under Cabinet Decision 75 of 2023. The FTA subsequently announced a relief initiative: that late-registration penalty is waived — and refunded or credited if already paid — where the taxable person submits its first Corporate Tax return within 7 months from the end of its first tax period.
- Applies to the AED 10,000 late Corporate Tax registration penalty only.
- Available to taxable persons and to exempt persons required to submit an annual declaration.
- Requires the return or declaration for the FIRST tax period to be filed inside the 7-month window.
- Penalties already settled are credited to the EmaraTax account and can be refunded.
Your legal filing deadline is 9 months after the tax period end, but the waiver window closes at 7 months. Filing in month 8 keeps you compliant yet loses the AED 10,000 relief. Confirm your normal date with the first CT return due date calculator.
How to calculate your last waiver date
- 1Determine the end date of your first tax period (between 6 and 18 months from incorporation).
- 2Add 7 calendar months to that date — that is the last date to file and still qualify.
- 3Compare it to the 9-month statutory deadline to see how many days of relief you are giving up by waiting.
- 4File the return on EmaraTax before the waiver date; the penalty is then removed or credited automatically.
| First tax period end | Waiver deadline (7 months) | Normal filing deadline (9 months) |
|---|---|---|
| 31 December 2024 | 31 July 2025 | 30 September 2025 |
| 31 December 2025 | 31 July 2026 | 30 September 2026 |
| 30 June 2026 | 31 January 2027 | 31 March 2027 |
| 31 December 2026 | 31 July 2027 | 30 September 2027 |
Who qualifies — and who does not
The relief is designed for first-period compliance, so it is unforgiving about scope. It does not extend to other penalty types, and it does not survive a late first return.
| Situation | Waiver available? |
|---|---|
| Registered late, first CT return filed within 7 months of period end | Yes — AED 10,000 waived or credited |
| Registered late, first return filed at month 8 or 9 | No — penalty stands |
| Late VAT registration penalty | No — separate regime |
| Late filing penalties (AED 500 / AED 1,000 per month) | No — apply for reconsideration instead |
| Exempt person that filed its annual declaration within 7 months | Yes |
If you fall outside the waiver, a formal Request for Reconsideration is the correct route to challenge or reduce the penalty.
Filing to claim the waiver, step by step
- 1Complete Corporate Tax registration on EmaraTax if you have not already — the TRN is required to file.
- 2Close the books for the entire first tax period and prepare the trial balance.
- 3Prepare the CT computation, including any Small Business Relief or QFZP election.
- 4Submit the return on EmaraTax inside the 7-month window and download the acknowledgement.
- 5Check the penalties tab: the AED 10,000 charge should be reversed or credited.
- 6If already paid, request a refund of the credited amount from the EmaraTax account.
The waiver follows from timely filing. Keep the filing acknowledgement and a screenshot of the penalty balance as evidence, and raise a clarification request if the credit does not appear.
What missing the window really costs
The waiver is worth AED 10,000 in cash, and Corporate Tax penalties are not deductible for CT purposes — so the real cost is the full amount out of retained profit. Add late filing penalties of AED 500 per month and 14% per annum on unpaid tax, and a first-period delay quickly compounds into tens of thousands of dirhams.
Model the downside with the FTA Penalty Calculator, then have our team file the return with the Corporate Tax filing service from AED 999*.