Since the introduction of Corporate Tax (CT) under Federal Decree-Law No. 47 of 2022, businesses in the UAE must register, calculate taxable income accurately, and file on time. Corporate Tax is a direct tax on business profits, designed to align the UAE with international tax standards while keeping it competitive. This page outlines how the regime works, who it applies to, and the main compliance obligations.
Corporate Tax applies to a business’s net accounting profit, adjusted for specific tax provisions, on a territorial basis. It covers:
To support the UAE’s commitment to global tax transparency and the OECD’s Base Erosion and Profit Shifting (BEPS) initiatives.
To diversify government revenue.
To maintain the UAE as a predictable, internationally integrated jurisdiction for business and investment.
On taxable income up to AED 375,000
On taxable income above AED 375,000
Qualifying Free Zone Persons may apply a 0% rate on Qualifying Income, subject to maintaining adequate substance and meeting the relevant regulatory conditions.
Certain entities and income streams are exempt or excluded, including:
All Taxable Persons must register with the Federal Tax Authority (FTA) and obtain a Tax Registration Number (TRN), regardless of revenue or tax liability.
Prepare financial statements in line with accepted accounting standards. Apply tax adjustments for disallowed expenses, non-taxable income, and specific deductions. Maintain supporting documentation, including transfer pricing studies and related-party records.
The CT return and any tax payable must be submitted through the EmaraTax portal within nine months of the end of the tax period. The filing includes the completed return, financial statements, and any disclosures required by the FTA.
Retain all financial and tax records for at least seven years after the end of the tax period to support any future FTA review or audit.
Assess activities against the “Qualifying Income” criteria; conducting business with the mainland or failing to meet the requirements may apply the standard 9% rate to all income.
Large groups meeting defined revenue thresholds may fall under the Pillar Two GloBE Rules, which can add a supplementary tax liability.
Ownership transfers, dividends, and intra-group financing each carry tax implications, and structuring decisions affect available exemptions.
Beyond compliance, Corporate Tax affects business structuring, cash flow management (provisioning for liabilities), transfer pricing policies, and investment and distribution decisions on after-tax returns and profit repatriation.
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