Corporate Tax Rate in UAE
the Corporate Tax Rate in UAE topic is one of the important topics that are in interest of the investors in the UAE, since the UAE is known to be very attractive for investments from all over the world because of the facilities that are being provided to investors in various sectors.
if you are an investor in the UAE, or planning to start investing there you need to start learning about the corporate tax in UAE, to know more about your rights and obligations, and not to commit any violation that might expose you and your business to fines or penalties, in this article we’re going to get to know what is the Corporate Tax Rate in UAE.
What is the Corporate Tax in UAE
the corporate tax (CT) is the amount of money being paid to the UAE government by businesses inside the UAE, whether these businesses were residents or non-residents in the UAE, if you don’t know what non-resident business means, we’ve learned that in a previous article that was about Corporate Tax For Non-Resident In UAE, you should take a look at it to get to know more about this topic.
Corporate Tax UAE Applicability
The corporate tax in UAE applies to the following:
- individuals and businesses conducting business activities in the UAE.
- free zone businesses.
- Foreign entities and individuals only if they conduct a trade or business in the UAE continuously and regularly.
- Banking operations.
- Businesses engaged in real estate management, construction, development, agency and brokerage activities.
UAE Corporate Tax Exemption
- Businesses involved in natural resource extraction are exempt from corporate tax (CT) as they will continue to be taxed at the Emirate level.
- UAE businesses will also be exempt from CT on dividends and capital gains from qualifying shares.
- Intra-group transactions and reorganizations meeting specific conditions will also be free from CT.
- individuals earning salaries and any other employment income, whether received from the public or the private sector.
- Individuals earning interest and other income from bank deposits or savings.
- dividends, capital gains, interest, royalties and other investment returns income earned by a foreign investor.
- investment in real estate by individuals in their capacity.
- dividends, capital gains, and other income earned by individuals from owning shares or other securities in their personal capacity.
What is the Corporate Tax Rate in UAE
According to the Corporate Tax Guide (CTGDT|1) that was issued by the Federal Tax Authority (FTA) in July 2024, Once the Taxable Income for the relevant Tax Period has been determined, it is subject to Corporate Tax at the following rates:
- 0% on the portion of the Taxable Income that does not exceed AED 375,000.
- 9% on the portion of the Taxable Income that exceeds AED 375,000.
Corporate Tax in UAE Free Zones
Free zone entities won’t have to pay any corporate tax on their qualifying income. In addition to exempting personal income, including salaries and savings or real estate investments, as we mentioned earlier. also any offshore company in a free zone will receive the same treatment as any other free zone company.
Reasons for Introducing Corporate Tax in UAE
The UAE introduced taxes as part of a broader plan across GCC countries to diversify their economies and reduce reliance on oil income, especially as oil prices have declined in recent years. To support this shift, GCC countries agreed to apply unified VAT and Excise tax frameworks, with each country setting its laws to manage these taxes locally. In the UAE, citizens and residents benefit from excellent public services, such as healthcare, roads, and education, funded entirely by the government.
Adding VAT and Excise taxes provides a new way for the UAE to generate income, helping maintain high-quality public services and a strong quality of life for future generations. This aligns with the UAE’s Vision 2021, which emphasizes sustainable infrastructure. Taxes also help the government address behaviors that may harm society. Excise taxes, for example, target products harmful to health, aiming to reduce their use and promote better well-being.
Conclusion
Thus we have come to know the most important points about the Corporate Tax Rate in UAE, and we have also illustrated What is the Corporate Tax in UAE, what is Corporate Tax UAE Applicability, cases of Exemption in UAE Corporate Tax, Corporate Tax in UAE Free Zones and Reasons for Introducing Corporate Tax in UAE. do not hesitate to contact us if you have any other inquiries.
Managing finances as an influencer in the UAE can get complicated, but AHG makes it easier. With our experience in influencer accounting, we handle everything from tax compliance to financial planning, so If you need any tax services or tax consultancy, you won’t find better than AHG Legal Accounts. Each of our teams has extensive experience in this field and will provide you with the best services in a professional manner. Please feel free to contact us today, we are always waiting for your request to be fulfilled!
Click Here
