Corporate Tax Services in UAE

Corporate tax in the UAE refers to the taxation imposed on the profits earned by companies operating within the country's borders. Unlike many other countries, the UAE has a unique tax system that does not levy federal corporate income tax on businesses. 

The UAE Ministry of Finance on 31st January 2022 announced the introduction of Federal Corporate Tax in UAE. 

UAE has maintained a tax-friendly environment with no federal corporate income tax, a notable attraction for businesses and investors. 

The corporate tax rate in the UAE was introduced on June 1, 2023. It applies to all businesses and commercial activities, except for:

• UAE government entities
• UAE government-controlled entities
• Companies engaged in extractive activities in the UAE
• Businesses involved in non-extractive natural resource activities in the UAE
• Branches of foreign banks

There are a number of tax incentives available to businesses in the UAE, including:

• A 100% exemption from corporate tax for the first 10 years of operation for businesses in certain free zones
• A 50% reduction in the corporate tax rate for businesses in specific sectors, such as manufacturing and tourism
• A deduction for research and development expenses
• A deduction for charitable donations

The corporate tax regime in the UAE is relatively simple and straightforward. It is designed to be competitive and attract foreign investment.

• The corporate tax rate is 9% on more than AED 375,000 taxable profits.
• The corporate tax applies to all businesses and commercial activities, except for:
  • UAE government entities
  • UAE government-controlled entities
  • Businesses engaged in extractive activities in the UAE.
  • Businesses engaged in non-extractive natural resource activities in the UAE.
  • Branches of foreign banks
• The corporate tax is calculated on the net profit of a business, after deducting allowable expenses. The net profit is calculated following the UAE Generally Accepted Accounting Principles (GAAP).
• The corporate tax is payable on an annual basis. The due date for filing the corporate tax return and paying the tax is 30 days after the end of the financial year.
• There are a number of tax incentives available to businesses in the UAE, including:
  • A 100% exemption from corporate tax for the first 10 years of operation for businesses in certain free zones
  • A 50% reduction in the corporate tax rate for businesses in specific sectors, such as manufacturing and tourism
  • A deduction for research and development expenses
  • A deduction for charitable donations

Here are some additional details on the corporate tax rules in the UAE:

• The corporate tax is payable to the Federal Tax Authority (FTA).
• The FTA has published several guidance notes on the corporate tax rules on its website.
• The FTA also has a helpdesk to contact for assistance with corporate tax matters.

The following documents are required for UAE Corporate Tax registration:

• Trade licence: A copy of the licence issued by the relevant local authority.
• Passport: A copy of the passport of the authorised signatory for the company.
• Emirates ID: A copy of the Emirates ID of the authorised signatory for the company.
• Memorandum of Association (MOA): A copy of the MOA of the company.
• Power of Attorney (POA): A POA from the company's shareholders authorising the authorised signatory to register for corporate tax.
• Financial statements: FTA may request copies of the financial statements for the previous year.
• Tax returns: For companies that have been in operation for more than one year, the FTA may request copies of the tax returns for the previous year.
• Other supporting documents: The FTA may request other documents, such as invoices, receipts, or contracts, to support the information provided in the registration application.