UAE Corporate Tax: What Businesses Need to Know

UAE Corporate Tax is a direct tax on the net profit of corporations and businesses, introduced under Federal Decree-Law No. 47 of 2022 and administered by the Federal Tax Authority (FTA). It applies to financial years beginning on or after 1 June 2023.

Corporate Tax Rates

• 0% on taxable income up to AED 375,000 — designed to support small businesses and start-ups.
• 9% on taxable income above AED 375,000.
• A 15% Domestic Minimum Top-up Tax (DMTT) applies to large multinational groups with consolidated global revenues of at least EUR 750 million, for financial years starting on or after 1 January 2025.

Who Is Subject to Corporate Tax

• UAE companies and other juridical persons incorporated in the UAE, or effectively managed and controlled in the UAE.
• Natural persons (individuals) who conduct a business or business activity in the UAE, as specified in the relevant Cabinet Decision.
• Non-resident juridical persons that have a Permanent Establishment in the UAE.

Free Zone Businesses

A Qualifying Free Zone Person can benefit from a 0% Corporate Tax rate on its Qualifying Income, provided it meets all the required conditions — including maintaining adequate substance in the UAE and complying with transfer pricing rules. Income that does not qualify is taxed at the standard 9% rate.

Exemptions

Certain entities are exempt from Corporate Tax, either automatically or after meeting conditions and obtaining approval:

• Government entities and government-controlled entities.
• Extractive and non-extractive natural resource businesses.
• Qualifying public benefit entities.
• Qualifying investment funds, and public or private pension and social security funds.

Registration and Filing

• All taxable persons must register with the Federal Tax Authority and obtain a Corporate Tax Registration Number through the EmaraTax portal.
• A Corporate Tax return must be filed for each tax period.
• The return must be filed — and any tax due paid — within 9 months from the end of the relevant tax period.

How Finrom can help

Finrom Consultancy supports UAE businesses with Corporate Tax registration, taxable-income assessment, Free Zone qualifying-income analysis and return filing. This article is a general overview and not tax advice — contact us for guidance specific to your business.