The UAE introduced federal corporate tax effective June 2023, applying a 9% tax on taxable profits exceeding AED 375,000. Our expert team ensures your business stays fully compliant with FTA regulations through seamless registration and ongoing advisory.
Corporate tax is a direct tax imposed on the net income of corporations and other business entities. The UAE introduced a federal corporate tax regime effective for financial years starting on or after 1 June 2023, positioning the country alongside global best practices while maintaining one of the most competitive tax environments worldwide.
The UAE corporate tax regime is designed to tax business profits at a competitive rate, support the country's strategic objectives, and reinforce its commitment to international tax transparency standards.
Corporate tax applies to all UAE businesses and commercial activities, unless specifically exempt. The following entities are required to register:
The UAE corporate tax applies a progressive structure designed to support small businesses while ensuring large corporations contribute fairly:
Taxable profits up to AED 375,000
Taxable profits exceeding AED 375,000
Free zone qualifying income meeting conditions
Submit required financial documents & company information
Register with the Federal Tax Authority (FTA)
Receive your Tax Registration Number (TRN)
Ongoing compliance & quarterly tax filing support
Competitive corporate tax rate on profits above AED 375,000 — one of the lowest globally.
Profits up to AED 375,000 are taxed at 0%, supporting small and medium enterprises.
Full support with Federal Tax Authority registration, filing, and ongoing compliance obligations.
Qualifying shareholdings may benefit from participation exemption, eliminating double taxation.
The UAE corporate tax regime applies a 9% tax on taxable profits exceeding AED 375,000, effective for financial years starting on or after 1 June 2023. Businesses must register with the FTA, file annual returns, and maintain proper financial records. Free zone qualifying entities may benefit from a 0% rate on qualifying income, subject to compliance with transfer pricing and substance requirements. Our business setup advisors can help you navigate the rules.
Understanding corporate tax in UAE is essential for every business. From determining your taxable income to claiming reliefs and exemptions, professional guidance ensures full compliance. Explore our VAT services and PRO services for complete business support.
All businesses must register for corporate tax regardless of profit level. However, tax is only payable on taxable profits exceeding AED 375,000 — profits below this threshold are taxed at 0%. Registration deadlines vary by business type, so it is important to register promptly with the FTA.
Free zone qualifying entities can benefit from a 0% corporate tax rate on qualifying income if they maintain adequate substance, comply with transfer pricing rules, and do not conduct business with mainland UAE (excluding through a branch). Non-qualifying income is subject to the standard 9% rate.
Corporate tax returns must be filed within 9 months following the end of the financial year. For example, if your financial year ends on 31 December, the return is due by 30 September of the following year. Tax payments are due at the same time as filing.
Penalties include AED 10,000 for late registration, AED 500 per month for late filing (capped at AED 2,000), and 14% per annum on unpaid tax. More severe penalties apply for tax evasion, including up to AED 1,000,000 fines.
Key reliefs include the participation exemption for qualifying shareholdings, small business relief for revenues under AED 3 million, business restructuring relief, and exemptions for government entities, extractive businesses, and qualifying public benefit entities.
Yes, UAE corporate tax allows for group relief where a parent company and its subsidiaries (with at least 75% ownership) can form a tax group and file a single return. This simplifies compliance and allows offsetting of losses within the group.
Still have questions? Contact our team for a free consultation.
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