Top Mistakes to Avoid When Filing Corporate Tax Returns in UAE

Filing corporate tax returns can be a tricky endeavor for any business. With constantly changing laws and regulations, it’s easy to get overwhelmed by all the details that need to be taken into account when filing taxes in the UAE. Whether you’re an experienced corporate tax payer or relatively new to it all, avoiding common mistakes from happening is key – so here are some of the top mistakes made while filing taxes in UAE and how you can avoid them! Keep reading if you want to make sure your tax season goes as smoothly as possible!

1. Not Keeping Records Updated 

Corporate tax returns require meticulous record keeping, so it’s essential to make sure that all your financial information is up to date and accurate . This includes all receipts, invoices, bank statements, income documents etc. If you don’t have the right documentation available when filing taxes in UAE, you could end up with incorrect calculations and huge fines.

2. Not Hiring A Tax Consultant

Filing Corporate Tax returns in the United Arab Emirates (UAE) can be quite a complex undertaking for business owners. While it is easy to assume that businesses have the necessary resources and time to handle this process themselves, oftentimes this isn’t the case because of the intricacies involved. Without proper guidance from a professional tax consultant, businesses risk making costly mistakes in the Corporate Tax filing process .

An inexperience business owner or even an experienced accountant may overlook important deadlines and details, leading to penalties imposed by the government. Furthermore, Corporate Tax regulations are ever-evolving, making it necessary for businesses to stay up-to-date on all changes in order to be compliant. Without the help of a tax consultant, it can be difficult to navigate such complex regulations and ensure that Corporate Tax penalty and returns are filed accurately and on time.

3. Incorrect Tax Point

When filing Corporate Tax returns in UAE, one of the biggest mistakes to avoid is incorrect “tax point”. The tax point is the date when you become liable for tax and determines which accounting period the transaction should be recorded against . This can have a huge impact on your Corporate Tax returns and with changes in legislation, it is important to get it right.

If the incorrect tax point is used for filing Corporate Tax returns, you may face issues such as late payment of taxes, penalties and interest. This could lead to unnecessary costs and an increase in financial liability. It is also important to consider when certain transactions are taxable or exempt from taxation as timing can be a key factor in determining whether Corporate Tax returns are accurate or not.

It is advisable to get assistance from an experienced tax consultant to ensure that your Corporate Tax returns are filed correctly and on time. A tax consultant will help you identify the correct “tax point” for different transactions and advise you on when taxes need to be paid, which could ultimately save you money. By considering the correct “tax point” when filing Corporate Tax returns in UAE, businesses can reduce the risk of incurring penalties and interest charges as well as ensure that their Corporate Tax returns are filed accurately.

4. Issues With Reverse Charge Mechanism

Tax filing for businesses can be a complex and arduous process, especially when dealing with a country’s complicated taxation laws such as those in the UAE. One of the most common mistakes made by business owners is not correctly understanding or implementing the Reverse Charge Mechanism (RCM).

RCM essentially means that instead of charging Value Added Tax (VAT) on the goods or services provided to customers, the customer is liable for self-charging and remitting VAT [3]. The RCM applies to some imports from certain countries and is applicable to businesses with an annual turnover of more than AED 375,000.

5. Error In The Usage Of Adjustment Columns

One of the most common mistakes while business tax filing owners occur when filing their corporate tax in UAE is not using the adjustment columns correctly. While it can be tempting to leave out any adjustments that are required while preparing a tax return, doing so could lead to serious consequences with fines or penalties from the authorities. Adjustments like depreciation, amortization and cost of goods sold must be accurately reported and accounted for when completing a tax return.

6. Not Taking Accounts of Specific Requirements

Moreover, not taking into account the specific requirements of UAE authorities regarding the filing of corporate taxes can also result in costly mistakes. For example, if pay corporation tax is filed incorrectly or late, it may incur a penalty that could have been avoided. Therefore, it is important to pay close attention to the details involved when filing corporate tax in UAE and to consult with an experienced corporate tax advisors if help is needed.

The use of adjustment columns can seem daunting but must be done accurately for a tax return to be valid. It is necessary for business tax filing owners to pay attention not only to their own accounting records


By following these tips and advisories, businesses can avoid the common mistakes associated with filing their Corporate Tax returns in UAE. These include incorrect “tax point”, issues with Reverse Charge Mechanism, error in the usage of adjustment columns as well as not taking accounts of specific requirements for pay corporation tax. Consulting with a corporate tax advisors could also be extremely beneficial to ensure that all Corporate Tax returns are filed correctly. Doing so ensures businesses pay the correct amount of taxes on time, avoid penalties and save money in the process.

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