Corporate Tax Solutions
Are You Prepared for the New Corporate Tax Regime?
With the implementation of corporate tax in the UAE, businesses must align with new regulatory requirements. Have you selected the right tax consultant?
What is Corporate Tax in the UAE?
As of June 1, 2023, the UAE has introduced a corporate tax framework imposing a 9% tax on business profits exceeding AED 375,000 (~$100,000). This change signifies a strategic shift from the traditionally tax-free model to a structured taxation approach.
Businesses earning below AED 375,000 remain exempt, supporting the growth of small enterprises and new ventures. This makes expert corporate tax services critical for navigating the transition effectively.
Meanwhile, multinational corporations generating profits over AED 3.01 billion (~$819 million) fall under a 15% tax rate, by the Global Minimum Corporate Tax Rate Agreement, aimed at discouraging profit shifting to low-tax jurisdictions.
This move underscores the UAE’s commitment to global tax standards while reinforcing its reputation as a competitive hub for international business. In this evolving tax environment, corporate tax consultants in Dubai play an essential role in providing informed guidance.
The new tax rules apply to financial years starting on or after June 1, 2023. For businesses with January-start fiscal years, tax obligations commence from January 1, 2024. This phased approach gives companies sufficient time to implement required changes with the help of qualified corporate tax advisors.
What are the Corporate Tax Brackets in the UAE?
Businesses with annual net profits up to AED 375,000
Tax Rate: 0%
No corporate tax is applicable on profits up to AED 375,000, benefiting startups and micro-businesses.
Businesses with annual net profits exceeding AED 375,000
Tax Rate: 9%
A flat 9% tax is applied only on profits above the AED 375,000 threshold.
Multinational Corporations with annual profits over AED 3.01 billion
Tax Rate: 15%
Subject to a 15% corporate tax under the OECD-aligned minimum tax framework for large entities.
What Businesses are Exempt from the Corporate Tax Laws?
✅ Businesses with annual net profits below AED 375,000
✅ Government-owned entities and public institutions
✅ Registered social and charitable organizations
✅ Government-controlled entities within specified activities
✅ Licensed businesses in extractive industries
✅ Authorized pension, retirement, and social benefit funds
✅ Regulated real estate investment vehicles
What is the Difference Between Corporate Tax and VAT?
Corporate tax is a direct tax imposed annually on a business’s net profits after allowable deductions. Filing is mandatory, and accurate returns are essential to maintain compliance, where corporate tax advisors can provide valuable support.
In contrast, VAT is an indirect tax collected at each stage of the supply chain. Businesses act as intermediaries by collecting VAT from consumers and remitting it to the authorities.
While VAT filings are typically submitted monthly or quarterly, corporate tax is filed once per year. Corporate tax consultants in Dubai can assist businesses in distinguishing between types of tax obligations.
What is the Corporate Tax for Free Zone Businesses?
Under the UAE’s corporate tax system introduced in 2023, free zone entities may retain their 0% tax benefit on qualifying income, provided they meet specific criteria.
Qualifying income from transactions within the free zone or with foreign entities remains tax-exempt. However, income from dealings with the UAE mainland or non-qualifying activities is subject to 9% corporate tax.
Regardless of tax liability, all free zone businesses must register and file corporate tax returns. Leveraging expert corporate tax advisory services ensures continued compliance and clarity on qualifying activities.
Types of Free Zones Based on Taxes
Designated Free Zones
These zones offer significant benefits, including a 0% corporate tax rate, full foreign ownership, and VAT exemptions on intra-zone transactions.
They are particularly attractive to companies in logistics, manufacturing, and re-export, offering customs duty waivers and simplified operations.
Examples: Jebel Ali Free Zone (JAFZA), Dubai Airport Free Zone (DAFZA), Abu Dhabi Airport Free Zone (ADAFZ)
Non-Designated Free Zones
While these zones still provide a 0% corporate tax rate on qualifying income, they may not offer VAT exemptions on transactions.
They continue to attract investment through ease of setup, sector-focused support, and full foreign ownership.
Examples: Dubai Media City (DMC), Dubai Healthcare City (DHCC), Ajman Free Zone
Corporate Tax for Freelancers
Freelancers in the UAE must hold a valid professional license, classifying them as legal entities. As such, they are subject to 9% corporate tax on profits exceeding AED 375,000.
Earnings below this amount are exempt, ensuring that freelance professionals enjoy flexibility while meeting legal requirements. Corporate tax consultants in Dubai can assist freelancers in managing registration, compliance, and tax filing.
This ensures freelancers operate confidently under the UAE tax regime, avoiding penalties and benefiting from accurate tax planning.
Advantages of Corporate Tax Services
Expert Guidance
Navigate the UAE tax system with clarity and confidence.
Maximized Deductions
Leverage allowable deductions to reduce overall tax liability.
Time Savings
Let tax professionals manage the process, allowing you to focus on business growth.
Reduced Risk of Errors
Ensure accuracy in filings to prevent penalties or audit triggers.
Strategic Tax Planning
Align tax strategies with long-term financial goals.
Audit Support
Receive expert representation during audits to streamline the process.
Regulatory Compliance
Stay current with UAE tax laws to avoid legal consequences.
Financial Forecasting
Plan future tax obligations to maintain healthy cash flow and budgeting.
Our Corporate Tax Services in Dubai, UAE
1. Corporate Tax Advice
We conduct a detailed evaluation of your business activities to determine tax applicability. Our consultants identify available exemptions and offer customized tax-saving recommendations.
2. Registration for Corporate Tax
Our team handles the complete registration process with the Federal Tax Authority (FTA), ensuring compliance and timely submission of required documentation.
3. Corporate Tax Returns
We manage the preparation and filing of your corporate tax returns under UAE regulations, ensuring accuracy and avoiding compliance issues.
4. Exempted Revenue
We assess your income streams to classify exempt revenues accurately and ensure your tax obligations reflect only taxable income.
5. Transfer Pricing Documents
Our services include documentation for related-party transactions to comply with the UAE’s transfer pricing requirements, maintaining transparency in cross-border dealings.
6. Violations & Penalties
We provide expert guidance in handling corporate tax violations, ensuring corrective actions are taken promptly to prevent future non-compliance.
Corporate Tax Procedure in the UAE
Timeline: 6 to 10 weeks
Step 1 – Assessment of Tax Obligations
Duration: 1–2 weeks
A comprehensive review of your financial records and business operations is conducted to determine your tax responsibilities.
Step 2 – Tax Planning
Duration: 1–2 weeks
Strategic planning is used to reduce liabilities and structure operations efficiently.
Step 3 – Filing of Tax Returns
Duration: 3–4 weeks
Timely and accurate submission of your tax return, along with required financial reports.
Step 4 – Payment of Taxes
Duration: 1 day
Calculated tax amounts are paid to ensure full compliance and avoid penalties.
Step 5 – Representation in Tax Audits
(If applicable)
Our experts represent your business in the event of a tax audit, managing all interactions with authorities.
Step 6 – Ongoing Support and Advice
Continuous
We provide continuous advisory support to help your business stay up to date with regulatory changes and tax requirements.
Documents Required for Corporate Tax
| Document | Description |
|---|---|
| Business License | Valid business license copy. |
| Tax Registration Certificate | Evidence of VAT registration (if applicable). |
| Financial Statements | Audited financial statements for the last year. |
| Tax Returns | Copies of previously filed tax returns. |
| Ownership Documents | ID and passport copies of shareholders and directors. |
| Contracts | Relevant contracts impacting tax liabilities. |
| Bank Statements | Bank statements for the financial year. |
| Expense Records | Invoices and receipts for business expenses. |
| VAT Returns | Copies of filed VAT returns. |
| Governance Documents | Board resolutions and meeting minutes. |