Corporate Tax in the UAE: 0% and 9%
UAE Corporate Tax applies from June 2023: 0% on taxable profit up to AED 375,000 and 9% above. Free Zone companies with qualifying income may apply 0% (QFZP). Registration is mandatory for all; the return is annual.
How the tax is calculated
Tax is based on accounting profit (with adjustments). The first AED 375,000 of profit is taxed at 0%, everything above at 9%. For example, at AED 600,000 profit the tax is 9% of AED 225,000 = AED 20,250.
Free Zone and QFZP
A "Qualifying Free Zone Person" (QFZP) pays 0% on qualifying income and 9% on non-qualifying income. To keep the benefit you need real UAE substance, must stay within the de minimis limit on non-qualifying income and maintain audited accounts.
Small Business Relief
Companies with revenue up to AED 3M can use Small Business Relief and be treated as having no taxable income — for tax periods ending on or before 31 December 2026. It simplifies reporting for small business but does not apply to QFZP.
FAQ
What is the Corporate Tax rate?
0% on profit up to AED 375,000 and 9% above.
Does Free Zone pay Corporate Tax?
A QFZP pays 0% on qualifying income and 9% on non-qualifying income if conditions are met.
Must I register below the threshold?
Yes — registration is mandatory for all; 0% applies up to AED 375,000, but a return must still be filed.