--- name: general-uae-corporate-tax-guide description: "Rates, Free Zone (QFZP) rules, Small Business Relief, deductions, deadlines and penalties for UAE Corporate Tax — source-cited to the FTA." license: "AGPL-3.0-or-later (code) / OpenAccountants Guide License v1.0 (content)" metadata: source: openaccountants openaccountants_url: "https://www.openaccountants.com/skills/general-uae-corporate-tax-guide" jurisdiction: "AE" last_updated: "2026-09-16" review_status: "pending_review" --- # General UAE Corporate Tax guide ## General UAE Corporate Tax guide > General information, not tax or legal advice. Verify current figures on the FTA's EmaraTax portal (tax.gov.ae) before relying on them. Current as of September 2026. ## 1. Overview The UAE Corporate Tax (CT) regime was introduced under Federal Decree-Law No. 47 of 2022, administered by the Federal Tax Authority (FTA). It applies to financial years starting on or after 1 June 2023 — a calendar-year business became subject to CT from 1 January 2024. It sits alongside, and separately from, UAE VAT (5%) and the Domestic Minimum Top-up Tax (DMTT) for large multinational groups. ## 2. Who Must Register and Pay - **Persons who must register and pay** — - UAE resident juridical persons — companies incorporated or effectively managed and controlled in the UAE, mainland or free zone. - Foreign (non-resident) companies with a permanent establishment or nexus in the UAE. - Natural persons (individuals) conducting business in the UAE with turnover exceeding AED 1,000,000 in a Gregorian calendar year. (Generally excluded: employment income, personal investment income (dividends, capital gains), and personal real estate income held in an individual's own name.) _(Federal Decree-Law No. 47 of 2022)_ ## 3. Tax Rates **Tax Rates** | Taxable income band | Rate | | --- | --- | | Up to AED 375,000 | 0% | | Above AED 375,000 | 9% | | Qualifying Free Zone Person, on Qualifying Income | 0% | | Large MNE groups in scope of DMTT (Pillar Two) | 15% minimum effective rate | ## 4. Free Zone Businesses: Qualifying Free Zone Person (QFZP) - **QFZP qualification requirements** — Free zone registration alone doesn't give 0%. To qualify as a QFZP, a business must: - Maintain adequate substance in the UAE. - Derive Qualifying Income as defined in the relevant Cabinet/Ministerial Decisions. - Keep non-qualifying revenue within the de minimis limit — the lower of 5% of total revenue or AED 5,000,000. Exceeding the limit taxes the *entire* taxable income at 9%, not just the excess. Registration and filing are mandatory even at 0%. _(relevant Cabinet/Ministerial Decisions)_ ## 5. Small Business Relief - **Small Business Relief** — Lets an eligible UAE resident business elect to be treated as having no taxable income for a period. - **Threshold:** gross revenue ≤ AED 3,000,000 in the current and every prior tax period. Exceeding it once permanently ends eligibility. - **Time-limited:** available for periods starting on/after 1 June 2023 and ending on/before 31 December 2026. No extension announced as of September 2026 — confirm before relying on it for 2027. - **Not available to:** Qualifying Free Zone Persons, or MNE group members with consolidated revenue over AED 3.15 billion (~EUR 750 million). - **Must be elected** annually in the CT return via EmaraTax — not retroactive. - **Trade-off:** no tax loss carryforward/use in an elected year. ## 6. Domestic Minimum Top-up Tax (Pillar Two) - **Domestic Minimum Top-up Tax (Pillar Two)** — Effective for financial years starting on/after 1 January 2025: MNE groups with consolidated global revenue ≥ EUR 750 million in at least 2 of the preceding 4 years pay a 15% minimum effective rate in the UAE. Doesn't affect most SMEs. ## 7. Deductible and Non-Deductible Expenses - **Deductible and Non-Deductible Expenses** — - **Entertainment:** only 50% deductible (client/shareholder/supplier meals, transport, admission, etc.). - **General interest limitation (GIDLR):** net interest deductible up to 30% of tax-adjusted EBITDA; de minimis AED 12,000,000 (below this, no limitation applies); disallowed amounts carry forward 10 tax periods. - **Special interest limitation (SIDLR):** interest on related-party loans funding dividends, redemptions, capital returns, or related-party acquisitions is non-deductible unless the lender is taxed ≥9% on that interest. - **Non-deductible:** dividends/profit distributions, fines and penalties (except agreed liquidated damages), donations to non-qualifying entities, and items specified by Cabinet Decision. ## 8. Registration Deadlines Incorporated before 1 March 2024 — by trade licence issue month: **Registration Deadlines by licence issue month** | Licence issued | Deadline | | --- | --- | | Jan/Feb | 31 May 2024 | | Mar/Apr | 30 Jun 2024 | | May | 31 Jul 2024 | | Jun | 31 Aug 2024 | | Jul | 30 Sep 2024 | | Aug/Sep | 31 Oct 2024 | | Oct/Nov | 30 Nov 2024 | | Dec | 31 Dec 2024 | ## 8. Registration Deadlines - **Incorporated on/after 1 March 2024** — Incorporated on/after 1 March 2024: register within 3 months of incorporation, via EmaraTax. ## 9. Filing and Payment - **Filing and Payment** — File the CT return and pay any tax due within 9 months of tax period end. Calendar-year business → due 30 September the following year. ## 10. Penalties - **Penalties** — - **Late registration:** fixed AED 10,000 (Cabinet Decision No. 10 of 2024). - **Waiver route:** FTA has offered a waiver if the first CT return/declaration is filed within a set window (historically 7 months of first tax period end) — terms have changed over time; verify current status on tax.gov.ae. - Separate penalties apply for late filing, late payment, and record-keeping failures under the general Tax Procedures framework. _(Cabinet Decision No. 10 of 2024)_ ## 11. Practical Checklist - Confirm your tax period and registration status/deadline. - Test Small Business Relief eligibility (cumulative AED 3M revenue test); remember the 2026 sunset. - If in a free zone, confirm QFZP status each period, including the 5%/AED 5M cap. - Check interest and entertainment expenses against GIDLR/SIDLR and the 50% rule. - Calendar the 9-month filing/payment deadline. - If part of a large group, check DMTT exposure. ## Sources tax.gov.ae (FTA Corporate Tax); Federal Decree-Law No. 47 of 2022; Cabinet Decision No. 10 of 2024 > Contributed by Jonathan I. Ruiz, CPA-0177929. --- ## Talk to a verified accountant This guide is maintained by the OpenAccountants network — accountants who put their name behind the tax answers AI gives people. The live, always-current version (and the professional behind it) is at [openaccountants.com](https://www.openaccountants.com). - Use it in your AI: https://www.openaccountants.com/connect - Meet the accountants: https://www.openaccountants.com/network > **General reference only.** This document does not constitute tax, legal, or > financial advice. Verify figures against the cited primary sources or with a > licensed professional before relying on them. ## Today's figures and who stands behind this skill This file is an AI skill (tax rules your AI follows) from OpenAccountants, copied on 2026-09-16. Rates, thresholds and deadlines change. For the current version of this skill, its official sources and the named accountant (if any) who stands behind it, call `get_skill` with slug `general-uae-corporate-tax-guide` on the OpenAccountants connector (https://www.openaccountants.com/connect), or read https://www.openaccountants.com/skills/general-uae-corporate-tax-guide. If neither is available, confirm every figure against the official source pages cited above before relying on it.