Overview
The UAE introduced a federal corporate tax under Federal Decree-Law No. 47 of 2022. It applies to financial years that start on or after 1 June 2023 and is administered by the Federal Tax Authority (FTA).
Who this is for
Companies and other legal entities in the UAE, including free zone companies, and individuals whose business turnover is more than AED 1 million in a calendar year.
Rates
| Taxable income | Rate |
|---|---|
| Up to AED 375,000 | 0% |
| Above AED 375,000 | 9% |
| Qualifying income of a Qualifying Free Zone Person | 0% |
Large multinational groups with global revenue of EUR 750 million or more are also subject to a domestic minimum top-up tax that brings their effective rate to 15%.
Small Business Relief
A resident business with revenue of AED 3 million or less in a tax period can choose to be treated as having no taxable income, for tax periods that end on or before 31 December 2026. It must still register and file a return.
Requirements
- Register with the FTA through EmaraTax, even if you expect to pay no tax.
- Keep accounting records and financial statements for at least seven years.
- File the return and pay the tax within nine months of the end of the tax period.
Step by step
- Create an EmaraTax account and add your trade licence and the owners' details.
- Apply for corporate tax registration and receive your tax registration number.
- Keep books that follow accepted accounting standards.
- File and pay within nine months of your financial year end.
Common mistakes
Missing the registration deadline because the business expects no profit; a late registration carries a penalty. Free zone companies assuming 0% applies to everything: only qualifying income does, and only when every condition is met.