What is UAE Corporate Tax?
UAE Corporate Tax is a federal tax on the net income or profit of corporations and other businesses from their business activities in the UAE. It was introduced in 2023 and applies to financial years starting on or after June 1, 2023.
UAE Corporate Tax represents a significant shift in the UAE's tax landscape:
Overview
- Federal tax on business profits and net income
- Introduced in 2023 for financial years starting June 1, 2023
- Applies to corporations and other business entities
- Administered by the Federal Tax Authority (FTA)
Tax Structure
- 0% rate for taxable income up to AED 375,000
- 9% rate for taxable income above AED 375,000
- Special rates for specific business types
- Different treatment for free zone businesses
Scope of Application
- UAE resident companies
- Foreign companies with UAE permanent establishment
- Businesses deriving UAE-source income
- Partnerships and other juridical persons
Key Features
- Comprehensive tax base with specific deductions
- Small business relief provisions
- Transfer pricing regulations
- Anti-avoidance measures
