Corporate Tax—also known as Corporate Income Tax or Business Profits Tax—is a direct tax imposed on the net profits of businesses operating in the UAE. The tax applies to both UAE-based companies and foreign entities with a permanent establishment in the UAE. It came into effect on 1 June 2023, introducing a new era of corporate taxation in the country.

All businesses operating in the UAE—whether incorporated onshore or in a free zone—must register for corporate tax if their income exceeds the tax-free threshold or if mandated by the Federal Tax Authority (FTA). This includes:

• UAE-based juridical persons (e.g., LLCs, PSCs, PJSCs)
• Individuals carrying out business in the UAE
• Foreign companies with a permanent establishment

Yes. All taxable persons under UAE Corporate Tax Law must register with the FTA and obtain a Tax Registration Number (TRN), regardless of whether tax is payable. Failing to register by the official deadline can lead to penalties.

Register your company for UAE Corporate Tax online via the EmaraTax portal provided by the FTA:

1. Log in to https://eservices.tax.gov.ae
2. Fill in the Corporate Tax registration form
3. Upload required documents (e.g., license, Emirates ID, MoA, etc.)
4. Submit and await your TRN confirmation

Commonly required documents include:

• Trade license
• Copies of the owner's Emirates ID and passport
• Memorandum of Association (MoA)
• Financial records (if available)
• Contact details and company structure chart

The UAE applies a tiered tax rate structure:

• 0% on net profits up to AED 375,000
• 9% on profits above AED 375,000
• 0% for qualifying income earned by free zone entities (subject to conditions)

Corporate tax is calculated on the accounting net profit shown in financial statements, prepared using International Financial Reporting Standards (IFRS) or internationally accepted accounting principles.

Example: For AED 1,000,000 in taxable income:

• First AED 375,000 = 0% tax
• Remaining AED 625,000 = 9% → AED 56,250 corporate tax payable

Qualifying income refers to income earned from:

• Transactions with other free zone entities
• International customers
• Certain qualifying activities outlined in Cabinet Decision No. 55

Exempt entities include:

• Government entities
• Government-controlled companies listed in Cabinet Decisions
• Qualifying public benefit entities
• Regulated pension or social security funds
• Regulated investment funds
• Businesses involved in natural resource extraction (subject to Emirate-level taxation)

All UAE-incorporated entities and foreign companies with UAE presence must:

• Register for corporate tax
• Maintain financial records
• File tax returns and pay corporate tax
• Monitor compliance deadlines to avoid fines