About Corporate Tax
The United Arab Emirates has officially introduced a federal Corporate Tax (CT) on business profits, effective for financial years starting on or after June 1, 2023. This landmark change is part of the UAE's strategy to diversify its economy and align with global tax transparency standards. While the new law applies to most businesses, a tiered system and a number of exemptions aim to support small businesses and maintain the country's competitive business environment.
Key Corporate Tax Rates
Income up to AED 375,000 is tax-free, supporting small businesses and startups to grow without heavy tax pressure.
Taxable income above AED 375,000 is subject to a 9% corporate tax, keeping the UAE among the most business-friendly countries worldwide.
Eligible Free Zone businesses enjoy 0% tax on "Qualifying Income," subject to conditions; non-qualifying income is taxed at 9%.
Who is Subject to Corporate Tax?
- All businesses and commercial activities operating under a license in the UAE are subject to the tax.
- Individuals conducting business activities will also be subject to CT if their annual turnover exceeds a specified threshold.
- Foreign entities will be taxed on income derived from a Permanent Establishment in the UAE.
Exemptions & Special Provisions
- Government entities and entities controlled by the government.
- Extractive businesses (e.g., oil and gas) that are subject to Emirate-level taxation.
- Qualifying Public Benefit Entities and Qualifying Investment Funds.
- Dividends and capital gains from qualifying shareholdings.
Why Expert House Chartered Accountants
Expert House Chartered Accountants is equipped to guide your business through every step of the UAE Corporate Tax journey. From initial assessment to ongoing compliance, our services ensure you meet all legal requirements and optimize your tax position.
- Corporate Tax Registration: We handle the entire registration process for your business on the Federal Tax Authority's (FTA) EmaraTax portal.
- Tax Impact Assessment: We analyze your business model to determine your specific tax obligations and identify opportunities for tax efficiency.
- Tax Return Filing: We prepare and file your annual Corporate Tax return, ensuring accuracy and timeliness to avoid penalties.
- Free Zone Compliance: We provide specialized support for Free Zone businesses, helping them navigate the rules to benefit from the 0% tax rate.
- General Advisory: We offer ongoing consultation to help you understand ministerial decisions, public clarifications, and any new regulations as they are released by the FTA.
