As per the Federal Decree-Law No. 47 of 2022, Public Joint Stock Companies (PJSCs) and Private Shareholding Companies (PSCs), fall within the category of juridical persons. All PJSCs and PSCs created under the UAE mainland legislation are “resident juridical persons” liable to pay corporate tax in the UAE.
What is a Joint Stock Company?
Whereas, a joint stock company can be defined as a type of business owned by multiple shareholders or stockholders. In such businesses, the owners all possess part of the shares or stock and benefit from limited liability. Hence, the stockholders' liability for the company's debts and obligations is limited to the amount they have invested in the company. Joint Stock Companies are managed by a board of directors, who make key decisions. In Public Joint Stock Companies, the shares can be easily transferred through the stock exchange. However, the shares of Private Joint Stock
Companies cannot be traded through public stock exchanges.
What is a Private Shareholding Company?
Unlike Public Joint Stock Companies (PJSCs), Private Shareholding Companies (PSCs) are owned by a comparatively lesser number of shareholders, which could include the founder, C-level executives as well as private investors. The stocks of PSCs cannot be publicly traded through the stock exchange. However, PSCs often benefit from less stringent regulatory requirements as compared to PJSCs.
How to Register Joint Stock Companies and Private Shareholding Companies for Corporate Tax in the UAE?
To ensure a seamless registration process, the FTA has created an online business tax portal, EmaraTax is a one-stop shop for business tax registration, tax return filing and all processes related to corporate tax in the UAE.
Read More: Corporate Tax Registration in UAE
Creation of EmaraTax Account for Business Tax
- Go to the Tax portal.
- Once in the portal, new users have the option to either sign up and create a new account or log in using their UAE pass.
- Those who are already registered with the FTA for VAT or Excise Tax purposes can use their existing account to log into EmaraTax
- To complete the registration one requires the following documents:
- Trade License
- Passport Copy (Of the Authorised Signatory)
- Emirates ID Copy (Of the Authorized Signatory)
- Proof of Authorization (For the Authorized Signatory) or Memorandum of Association (MOA)
Business Tax Registration for Joint Stock Companies & Private Shareholding Companies
- Once an account is created by entering the phone number and email ID, you can log in and select the corporate tax tab.
- The user then needs to select the relevant "taxable person" profile from the existing list or create a new profile.
- After selecting the corporate tax option, the user has to carefully go through the instructions and guidelines given on the corporate tax registration page.
- Once you are thoroughly familiar with the instructions and guidelines given, check the box next to "I confirm that I have read the above instructions and guidelines"
- Next, click the "start" option on the lower right corner to initiate the corporate income tax registration process
- The first step of registration requires you to provide information on the Entity Type, Entity Subtype, Country of Registration/Incorporation, Date of Incorporation, and Corporate Tax Period
- Here, one can choose between “Legal Person - UAE Public Joint Stock Company” and “Legal Person - UAE Private Company”
- In the next step, you need to provide the business's Main License Details
- Next, select "Add Business Activities" and provide the details of all the business activities undertaken. For this, you need to select the industry, Main Group, and Sub-Group of each business activity.
- In the next step, you need to provide the details of all shareholders/owners with at least 25% of ownership in the business. The details mandated include the legal name of the owner, owner type, start date of ownership as well the percentage held.
- Next, you need to provide details associated with all local business branches in the UAE - trade license details, business activities and owners' details.
- In the next step, you need to provide the contact details of the business.
- In the following section, enter the details of the authorized signatory and provide the necessary documents for proof.
- In the last section, you can review all the details provided in the application and then select submit.
What Happens After Submission of Corporate Income Tax Registration Request?
After submission, you can check your user dashboard from time to time to see the status of the application as well as other relevant updates. On average, it requires around twenty business days from the date of application for the FTA to process the request and get back to you. The FTA might choose to either accept, reject or request additional documents to complete verification if required. It is advised to seek the aid of legal consultants to ensure seamless corporation tax registration, reducing the chances of rejection or resubmission by the FTA.
How Tax Consultants in UAE Assists
To effectively ensure compliance with the corporate tax law and seamlessly register for corporate tax, businesses are advised to seek the expert services of top Tax Consultants in UAE. Thus, contact us today and we shall be glad to assist you.