The UAE introduced a federal corporate tax for financial years starting on or after 1 June 2023. For most of the founders we work with it is the first tax they have met here, and the rules are simpler than people fear. They do, however, start on the day your licence is issued.
Who has to register
Every company formed in the UAE, on the mainland or in a free zone, must register for corporate tax with the Federal Tax Authority, even if it expects to pay nothing. Registration is online through EmaraTax and gives you a tax registration number. We file it for every client in the weeks after the licence is issued, so the deadline never comes close.
Late registration carries a fixed penalty of AED 10,000, so this is the one deadline we never leave to the end.
The rates
- 0% on taxable income up to AED 375,000.
- 9% on taxable income above AED 375,000.
- A 15% domestic minimum top-up tax for multinational groups with global revenue of EUR 750 million or more, which won’t apply to most new companies.
Small business relief
If your revenue is AED 3 million or less in a tax period, you can elect to be treated as having no taxable income for that period. The relief covers tax periods ending on or before 31 December 2026, so for many companies formed this year it applies to the first return only. It is an election, not automatic: you still file a return and choose it.
Free zone companies
A free zone company can pay 0% on its qualifying income if it meets the conditions to be a Qualifying Free Zone Person: real substance in the zone, audited financial statements, arm’s-length pricing with related parties, and income from qualifying activities. Income that doesn’t qualify is taxed at 9%, and if non-qualifying revenue passes the lower of AED 5 million or 5% of total revenue, the company loses the 0% rate for five years.
That last rule is the most important reason to choose your free zone and activity carefully at the start, and it is the question we spend most time on in a formation plan.
Your first-year calendar
- After the licence: register for corporate tax, and for VAT once your taxable supplies pass AED 375,000 in any 12 months.
- Throughout the year: keep accounts, invoices and contracts, and keep them for seven years.
- Within nine months of your year end: file the return and pay any tax due.
What we do
Our compliance service registers you, keeps the calendar, prepares the return with your accountant and writes to you six weeks before anything is due. If you already have an accountant, we work alongside them.
This article is general information as of September 2026, not tax advice for your company. Your written plan covers your own position.
