The Federal Tax Authority has emphasized the importance for corporate taxpayers to maintain all records and documents that validate the accuracy of the information included in their tax returns or any other documents required by the authority. These records enable the authority to verify taxable income for corporate tax purposes.
In a recent press release, the authority stated that the types of records and documents needed will vary depending on the nature of the business activities conducted by the taxpayer. However, there are essential documents that must be preserved. These include, but are not limited to, a record of the corporate transactions during the taxation period, an asset register detailing any purchases or disposals of assets, a liabilities record, and a register of shares or stakes held at the end of the taxation period.
The authority pointed out that if corporate taxpayers fail to keep the required records and any additional information specified by the Tax Procedures Law and the Corporate Tax Law, administrative penalties will be enforced in accordance with the relevant tax legislation.
The Federal Tax Authority also clarified that tax-exempt individuals are required to keep records that allow the authority to verify their exemption status according to the Corporate Tax Law. The documentation needed in this case will depend on the reason for the individual’s tax exemption, and both taxpayers and exempt individuals must retain records and documents for at least seven years after the end of the relevant tax period.
The authority reiterated its call for corporate taxpayers to file their tax returns and pay the corporate tax due for the relevant tax period within the stipulated legal timelines to avoid late fees and penalties for non-compliance.
It also highlighted that corporate taxpayers must submit their tax returns and pay the due corporate tax to the authority within a maximum of nine months from the end of their respective tax periods. For tax-exempt individuals required to register, annual declarations must be filed within nine months of the end of the financial year. For instance, a corporate taxpayer whose financial year ends on December 31, 2025, must submit their tax return and pay the due corporate tax by September 30, 2026, at the latest.