Since its introduction in June 2023, UAE Corporate Tax at a standard rate of 9% has become an important part of business compliance in the country. It generally applies to taxable income exceeding AED 375,000, requiring businesses to assess their tax position carefully and maintain proper records.
We help businesses with FTA Corporate Tax Registration, Taxable Income Calculation, Corporate Tax Return Filing, Compliance, and Deregistration, ensuring their tax obligations are managed accurately and on time.
CA Rajesh | 20+ Years of Expertise in UAE Corporate Tax & Business Compliance
Corporate Tax is a direct tax that the UAE government levies on the net income or profit earned by companies and other business entities. It is sometimes referred to as “Corporate Income Tax” or “Business Profits Tax” in other jurisdictions, and it functions on the same basic principle here: the more profit a company generates within a tax period, the more tax it is generally required to pay, after allowable deductions are applied.
|
Key Fact |
Detail |
|---|---|
|
Standard tax rate |
9% on taxable profit above AED 375,000 |
|
Small profit relief |
0% on taxable profit up to AED 375,000 |
|
Free Zone Qualifying Income |
0%, subject to meeting qualifying conditions |
|
Governing law |
UAE Corporate Tax Law (Federal Decree-Law) |
|
Applies to |
Mainland, Free Zone, and certain foreign entities |
The UAE introduced this federal Corporate Tax framework to align itself with international tax standards, to diversify government revenue beyond oil income, and to strengthen its position as a transparent, globally respected business hub.
For a business owner, this means that profit, not just revenue, must now be tracked, calculated, and reported accurately, and that financial records must be maintained in a way that satisfies the requirements set out under UAE Corporate Tax Law.
Corporate Tax in UAE and VAT in UAE are separate taxes.
A company that is registered for VAT does not automatically satisfy its Corporate Tax obligations. The FTA specifically confirms that businesses registered for VAT may still need to register separately for Corporate Tax.
Not every individual or entity is treated the same way under this law, which is why professional tax guidance is so valuable in helping business owners determine exactly where they stand.
|
Entity Type |
Tax Treatment |
|---|---|
|
Resident company (UAE-based or effectively managed from the UAE) |
Taxed on worldwide income, subject to specific exemptions |
|
Non-resident with UAE permanent establishment |
Taxed on income connected to that establishment |
|
Non-resident with UAE-sourced income only |
Taxed only on UAE-sourced income, subject to exemptions |
|
Qualifying Free Zone Person |
0% on Qualifying Income; standard rate on non-qualifying income |
Understanding which category your business falls into is the first, and arguably most important, step toward compliance.
Tailoring Compliance Services To Match The Specific Needs Of Businesses.
A complete tax service should cover more than simply submitting an annual return. Businesses need support throughout the Corporate Tax compliance cycle.
|
Service |
What it Involves |
|---|---|
|
Corporate Tax registration |
Assistance with FTA registration and required information |
|
Tax position review |
Understanding whether and how the business is subject to Corporate Tax |
|
Taxable income calculation |
Reviewing accounting profit and required tax adjustments |
|
Expense review |
Identifying relevant deductible and non-deductible expenses |
|
Corporate Tax return |
Preparing information required for the annual return |
|
Compliance review |
Checking important obligations and documentation |
|
Free zone assessment |
Reviewing whether the business may qualify for the applicable Free Zone treatment |
|
Tax guidance |
Explaining Corporate Tax requirements in practical terms |
The FTA provides Corporate Tax Registration through the EmaraTax platform, and registration applications require supporting documents such as the trade licence and relevant company information.
Businesses with a financial year from April–March must file their UAE Corporate Tax Return and pay any Corporate Tax due by 31 December 2026.
Need help with Corporate Tax filing? Our team can assist with taxable income calculation, Corporate Tax return preparation, filing, and compliance.
When calculating taxable income, not every business expense can be deducted. As a general principle, expenses incurred wholly for business purposes are deductible.
|
Disallowed or Restricted Expense |
Treatment |
|---|---|
|
Client entertainment costs |
Only 50% deductible |
|
Administrative penalties and fines |
Fully disallowed |
|
Donations to unapproved organisations |
Fully disallowed |
|
Unrealised profits and losses |
Generally disallowed |
|
Interest exceeding 30% of EBITDA |
Excess amount disallowed |
Understanding this distinction matters considerably, because miscalculating deductible expenses can lead to an inaccurate tax return, which in turn creates exposure to penalties during a Federal Tax Authority audit or review.
The purpose of tax advice is to help the company apply the applicable UAE rules correctly rather than simply looking for ways to reduce its tax liability.
| Compliance Area | What It Involves | How We Help Your Business |
|---|---|---|
| FTA Corporate Tax Registration | Registering taxable businesses with the Federal Tax Authority and obtaining a Corporate Tax Registration Number. | We assist with FTA registration, document preparation, application submission, and registration follow-up. |
| Taxable Income & Compliance Review | Reviewing business records and identifying the information required for Corporate Tax compliance. | We help review financial information, identify taxable income, and organise the required records for filing. |
| Corporate Tax Return Filing | Preparing and submitting the Corporate Tax return for the relevant Tax Period. | We assist with return preparation, tax calculations, document review, and FTA filing. |
| Corporate Tax Filing Deadlines | Corporate Tax returns and payment of tax due are generally required within 9 months from the end of the relevant Tax Period. | We help you track applicable deadlines and prepare the required filings on time. |
| Corporate Tax Deregistration | Businesses that cease to be taxable may need to apply for Corporate Tax deregistration with the FTA. | We assist with deregistration applications, required documentation, final compliance checks, and FTA follow-up. |
| Ongoing CT Compliance Support | Maintaining Corporate Tax compliance after registration and filing. | We provide ongoing compliance support, document reviews, deadline tracking, and assistance with FTA requirements. |
When calculating taxable income, not every business expense can be deducted. As a general principle, expenses incurred wholly for business purposes are deductible.
|
Disallowed or Restricted Expense |
Treatment |
|---|---|
|
Client entertainment costs |
Only 50% deductible |
|
Administrative penalties and fines |
Fully disallowed |
|
Donations to unapproved organisations |
Fully disallowed |
|
Unrealised profits and losses |
Generally disallowed |
|
Interest exceeding 30% of EBITDA |
Excess amount disallowed |
Understanding this distinction matters considerably, because miscalculating deductible expenses can lead to an inaccurate tax return, which in turn creates exposure to penalties during a Federal Tax Authority audit or review.
Need a Corporate Tax Compliance Consultant in UAE?
Our experienced tax professionals can help your business with Corporate Tax Registration, compliance, documentation, Corporate Tax Return Filing, and ongoing Tax requirements.
The standard rate is 9% on taxable profit above AED 375,000. Profit up to that threshold is taxed at 0%, and eligible Free Zone entities can also earn 0% on Qualifying Income. Most businesses engage corporate tax services UAE providers to confirm which rate applies to their specific structure before filing.
Not necessarily. Free Zone companies that meet specific substance and activity conditions can qualify for a 0% rate on Qualifying Income, but income outside those conditions is taxed at the standard rate. This distinction is a common trigger point for corporate tax advisory services UAE engagements, since misclassifying income can cost a Free Zone entity its preferential status.
Once per Tax Period, which is typically twelve months and aligned with your financial year. The return is due within nine months of the end of that period.
The UAE applies a fixed penalty for the first month of delay, additional fixed penalties for each following month, and interest on any unpaid tax until it is settled in full.
No. VAT is an indirect tax on the supply of goods and services, while Corporate Tax is a direct tax on a company's net profit. Businesses may be liable for both, depending on their activity and turnover, which is why UAE corporate tax services often cover VAT and Corporate Tax reconciliation together.
