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Corporate Tax

Is a direct Tax paid on corporations and other enterprises’ net income or profits. The UAE Ministry of Finance announced on January 31, 2022, the implementation of a federal corporate tax in the UAE, which will be effective for fiscal years beginning on or after June 1, 2023. Such taxes are generally computed on a business’s accounting net profit/income after adjusting for certain items specified in UAE Corporate Tax law.

Corporate Tax in UAE is a direct Tax paid on companies and other enterprises’ net revenue or profit. In other countries, Corporate Tax is also known as “Corporate Income Tax” or “Business Profits Tax.”

 

Applicability of Corporate Tax in UAE

The UAE corporate tax policy will be among the most competitive globally, with a standard statutory tax rate of 9%.
For the encouragement of small firms and startups, a 0% tax rate applies to taxable earnings up to Dh375,000. Personal income from employment, real estate, and other investments, and any other income generated by people not derived from a business or different kind of commercial activity licensed or otherwise authorized to be conducted in the UAE, will be exempt from corporation tax.

A competitive Corporate Tax regime based on worldwide best practices would strengthen the UAE’s position as a major global center for business and investment and expedite the UAE’s development and economic growth to meet its strategic goals. Implementing a Corporate Tax regime underscores the UAE’s commitment to upholding international tax transparency requirements and eliminating harmful tax practices.