Bangladeshi businesses miss Corporate Tax filing deadline

More than 80 per cent of the 150,000 Bangladeshi-owned registered businesses in the UAE have missed filing Corporate Tax returns on deadline that was September 30, 2025 for the businesses whose financial year completed on December 31, 2024.

Most Bangladeshi businesses fall under the micro, small and medium (MSME) categories – who do not maintain proper invoicing, accounts, etc. There are thousands of those who do not have documents in place, others are not aware of the dangers that lie ahead for non-compliance of tax filing.

Corporate Tax is a form of direct tax levied on the net income or profit of corporations and other businesses. Corporate Tax is sometimes also referred to as “Corporate Income Tax” or “Business Profits Tax” in other jurisdictions.

The UAE introduced its federal Corporate Tax regime for financial years starting on or after June 1, 2023, with a standard 9 percent rate on taxable profits exceeding Dh375,000 (US$102,096.38), alongside carve-outs like free zone exemptions and small-business relief. However, compliance goes beyond filing. Companies must complete their Financial Year (FY) 2024 audited accounts, make any necessary Transfer Pricing (TP) adjustments, and prepare comprehensive TP documentation — all before audits are finalised.

“A competitive Corporate Tax regime based on international best practices is expected to cement the UAE’s position as a leading global hub for business and investment and accelerate the UAE’s development and transformation to achieve its strategic objectives,” said a spokesperson from the UAE Federal Tax Authority (FTA).

“Introducing a Corporate Tax regime also reaffirms the UAE’s commitment to meeting international standards for tax transparency and preventing harmful tax practices.”

UAE Corporate Tax applies to juridical persons incorporated in the UAE and juridical persons effectively managed and controlled in the UAE, as well as to foreign juridical persons that have a permanent establishment (see section Foreign persons) in the UAE.

Individuals will be subject to Corporate Tax only if they are engaged in a business or business activity in the UAE, either directly or through an unincorporated partnership or sole proprietorship.
A Cabinet Decision will be issued in due course specifying further information on what would bring a natural person within the scope of UAE Corporate Tax .

“The UAE Corporate Tax does not differentiate between nationality or residence. Juridical persons that are incorporated or resident in the UAE, or that have a permanent establishment in the UAE, will be subject to UAE Corporate Tax. This applies irrespective of the residence and nationality of the individual founders or (ultimate) owners of the entity,” the spokesperson says.

The taxable income for a Tax Period is the accounting net profit (or loss) of the business, after making adjustments for certain items as defined in the Corporate Tax Law.

Cost of Non-Compliance
The repercussions of non-compliance in filing the corporate tax return in the UAE are both broader and deeper than they may initially appear.
A late filing now attracts a recurring penalty of Dh500 per month, or part thereof, for the first twelve months, which escalates to Dh1,000 per month, or part thereof, thereafter. This penalty is automatically levied on the first day of each month and continues until the month in which the return is filed. Separately, failure to pay the due corporate tax triggers an annual interest rate of 14 per cent, calculated on a monthly basis from the day immediately following the due date. The interest continues to accrue on the same date of every month from the day following the due date of payment until the liability is fully settled.

The regulations also provide specific timelines in the case of voluntary disclosures. Where an entity files a voluntary disclosure that increases its corporate tax liability, the additional tax must be paid within twenty business days of submission. If the tax is not paid within this period, interest at 14 percent per annum applies from the twenty-first business day until the payment is made. Most Bangladeshi-owned businesses are likely to face serious fines that will affect their rating.