With corporate tax now implemented in the UAE, many businesses are still adjusting to the new compliance requirements. While some companies are well-prepared, others unknowingly make costly mistakes that can lead to fines or audits.

At Al Maase Auditing, we help UAE businesses stay compliant and efficient. In this article, we highlight the top 5 corporate tax mistakes we’ve seen — and how your company can avoid them.

Mistake #1: Not Understanding Free Zone Qualification Rules

Many Free Zone businesses believe they automatically qualify for the 0% corporate tax rate, but this only applies to specific activities and conditions.

How to Avoid It:

Review your business model with a tax advisor. We assess your eligibility and help structure your income properly.

Mistake #2: Poor Record-Keeping & Documentation

Under corporate tax law, businesses must maintain detailed financial records for at least 7 years. Missing or inaccurate documents can lead to audits and penalties.

How to Avoid It:

Invest in proper bookkeeping systems or outsource to a qualified accounting firm like Al Maase for full compliance.

Mistake #3: Ignoring Related Party Transactions

Many business owners overlook transfer pricing rules when dealing with sister companies or subsidiaries — which can trigger red flags.

How to Avoid It:

Disclose all related party transactions and maintain proper documentation. Our tax consultants will guide you on what’s required under UAE law.

Mistake #4: Filing Returns Without a Tax Strategy

Rushing through tax filing without evaluating allowable deductions, exemptions, or loss carry-forwards can lead to overpayment or errors.

How to Avoid It:

Work with experienced corporate tax advisors to plan your filings, minimize liabilities, and avoid filing mistakes.

Conclusion: Be Proactive, Not Reactive

Corporate tax compliance is now a long-term business responsibility in the UAE. Avoiding these common mistakes can save your company thousands in fines — and even protect your brand’s credibility.