In 2022, the United Arab Emirates released new corporate tax laws. In order to provide tax transparency in accordance with international norms and to eradicate unfair tax practices, corporate taxation was introduced.

• Companies that make more than AED 375,000 in annual profits are subject to 9% corporate tax.
• AED 375,000 is the maximum amount of your taxable income that is subject to corporate tax. An yearly profit of AED 425,000, for instance, would be subject to the following corporate tax rates:

     0% for AED 0 – AED 375,000

     9% for AED 375,000 – AED 425,000

     Corporate Tax = AED 4,500

     i.e., 9% of (AED 425,000 – AED 375,000 = AED 50,000)

• Within nine months following the end of the applicable tax period, corporate tax returns must be filed.
• Dividends, capital gains, real estate investments, and income from oil and gas companies are all exempt from corporate tax.
• As long as they are qualified and don’t transact business with the mainland, corporations operating in free zones are subject to 0% corporate tax. Free zone businesses must, nevertheless, file tax returns.
• Under some circumstances, a collection of businesses may be treated as a single taxable company.