The headline rates

For most taxable persons, UAE Corporate Tax is 0% on the first AED 375,000 of taxable income and 9% on taxable income above AED 375,000. This threshold applies to taxable income, not turnover. Taxable income is generally based on accounting profit after adjustments required under the Corporate Tax Law. Special rules can apply to particular entities and large multinational groups.

A free-zone company is not automatically tax-free

A free-zone person is within the Corporate Tax system. A Qualifying Free Zone Person may benefit from a 0% rate on qualifying income if it meets the legal conditions. The Federal Tax Authority identifies conditions including adequate substance in the UAE, qualifying income, transfer-pricing compliance and documentation, audited financial statements, and no election to be taxed under the standard regime. Income that does not qualify can be taxed at 9%. The analysis depends on the actual transactions and applicable Cabinet and Ministerial Decisions.

Registration and returns still matter

Tax registration is a separate obligation from paying tax. The FTA requires taxable persons to register by the timeline that applies to their category. Late registration can trigger an administrative penalty. Taxable persons generally file a Corporate Tax return and pay any tax due within nine months after the end of the tax period. Keep accounts and supporting records that explain revenue, expenses, related-party dealings and any claim to a special treatment.

Small Business Relief is not the same as a zero-tax guarantee

A qualifying resident person may elect for Small Business Relief for eligible tax periods, subject to the revenue threshold and other conditions in force. The relief does not erase record-keeping or every compliance task, and it is not available to all entity types or circumstances. Confirm the current conditions directly with the FTA before relying on it.

What to do next

Identify the entity and first tax period; check the applicable registration deadline; decide whether the free-zone regime or any relief could apply; and keep books that support the analysis. If ownership crosses borders or the company has related parties, seek qualified UAE tax advice before filing.

Official sources and further reading

Rules can change and individual facts matter. These government and regulator pages are the starting point for checking the current position.

GENERAL INFORMATION ONLY · THIS ARTICLE IS NOT LEGAL, TAX, IMMIGRATION OR FINANCIAL ADVICE. CONFIRM THE CURRENT POSITION WITH THE RELEVANT UAE AUTHORITY OR A QUALIFIED PROFESSIONAL.