Taxation of Natural Persons under the Corporate Tax Law Corporate Tax Guide | CTGTNP1 | November 2023

The Federal Tax Authority (FTA) has released a comprehensive guide to assist natural persons in understanding the criteria for determining their inclusion under the newly enacted Corporate Tax Law, effective since June 1, 2023.

Key Points:

1. Guide Overview:

   • The FTA's guide offers a simplified explanation and instructions for natural persons earning income in the UAE. It aims to help individuals ascertain their liability under the Corporate Tax Law.

2. Call to Action:

   • The FTA strongly encourages all concerned individuals generating income in the UAE or engaged in business activities, either wholly or partly, to consult the new guide. The guide, along with relevant materials, is available on the FTA's official website.

3. Importance of Reading the Guide:

   • Emphasizing clarity, the FTA urges readers to thoroughly review the guide to gain a comprehensive understanding of its content and definitions. Practical examples are included to illustrate the application of the Corporate Tax Law to both resident and non-resident natural persons conducting business in the UAE.

4. Registration Requirement:

   • The guide specifies that a natural person must register for corporate tax purposes and obtain a Tax Registration Number if their total turnover exceeds Dh1 million within a Gregorian calendar year, effective from the calendar year 2024.

5. Non-Resident Taxation:

   • According to the guide, non-resident natural persons are subject to corporate tax if they have a permanent establishment in the UAE, with the total turnover of the establishment exceeding Dh1 million within a Gregorian calendar year, starting from calendar year 2024.

This guide serves as a vital resource for navigating the Corporate Tax Law landscape in the UAE, offering clarity on registration requirements and taxation obligations for both resident and non-resident natural persons.