Tax Services
UAE Corporate Tax (9%): registration, filing and rates
Guide to UAE Corporate Tax in Dubai: 9% on taxable profit above AED 375,000, FTA registration, filing within 9 months, accounting requirements and penalties.
The UAE Corporate Tax taxes company profits at a general rate of 9% on the portion exceeding AED 375,000 per financial year. It is in force for financial years starting on or after 1 June 2023 and applies to all companies in the country, including those in free zones. In this guide we explain who is in scope, how the tax is calculated, which deadlines apply and which accounting obligations it brings — and how we manage it at LorcaBase from start to finish.
What the Corporate Tax is and since when it applies
The Corporate Tax is the federal tax on business profits introduced by Federal Decree-Law No. 47 of 2022. It applies to financial years starting on or after 1 June 2023: a company with a calendar-year period (January–December) became subject from 1 January 2024.
It is administered by the Federal Tax Authority (FTA), the same authority that manages VAT, but with a separate registration: holding a VAT TRN does not mean being registered for Corporate Tax.
The design of the tax follows international standards: an IFRS accounting base with tax adjustments, the arm’s length principle for related-party transactions and a single annual return.
Who is subject to the tax
Within the scope of the Corporate Tax are:
- Companies incorporated in the UAE — mainland, free zone and other corporate forms in the country.
- Individuals carrying on business activity in the UAE above the regulatory turnover threshold.
- Non-residents with a permanent establishment or taxable nexus in the Emirates.
Certain entities may be exempt — government bodies, certain qualifying investment funds, approved charities —, but the exemption is not automatic: in several cases it requires an application and a decision by the FTA.
Free zone companies are fully within the system: they must register, keep accounting records and file a return every year. Their specific treatment depends on qualification requirements and on the composition of their income, and it should be reviewed case by case against the rules in force before making structural decisions.
Tax rate and taxable base: 9% above AED 375,000
The calculation starts from the accounting profit for the year prepared under IFRS and is adjusted under the law: exempt income (such as certain dividends and the participation exemption where its conditions are met), non-deductible expenses, interest limitation and transfer pricing adjustments.
On the resulting taxable profit:
- The portion that does not exceed AED 375,000 is not taxed at the general rate.
- The portion that exceeds AED 375,000 is taxed at 9%.
The threshold applies per legal entity and per financial year. In groups with several companies it is worth planning the structure — including the option of a tax group — to avoid both duplications and surprises.
Registration with the FTA: mandatory even without profit
Every taxable person must register for Corporate Tax through the FTA’s EmaraTax portal and obtain their specific TRN, even if the business is loss-making, even if it does not exceed the AED 375,000 threshold and even if it applies Small Business Relief.
The FTA set staggered registration deadlines based on the licence issue date, and late registration is penalised under the regime of Cabinet Decision No. 75 of 2023. For a new company, the practical approach is to handle the registration as part of the incorporation process itself, which is how we do it with our clients.
Return and payment: 9 months from year end
The Corporate Tax is self-assessed through a single annual return, filed and paid within 9 months of the end of the financial year. There are no advance instalments.
Two examples with a calendar-style year:
- Financial year ended 31 December 2025 → return and payment by 30 September 2026.
- Financial year ended 31 March 2026 → return and payment by 31 December 2026.
The return requires the accounting to be closed, reconciled and adjusted. Starting to prepare it in month eight is the usual recipe for penalties; our compliance calendar starts at year end.
Small Business Relief: relief up to AED 3,000,000
Small Business Relief (Ministerial Decision No. 73 of 2023) allows resident persons with revenue of up to AED 3,000,000 in the financial year — and in the eligible previous years — to elect to be treated as having no taxable profit. It is available for financial years ending on or before 31 December 2026.
Important: the relief does not exempt you from registering or filing a return, and electing it has side effects (for example, on the carry-forward of losses) that should be assessed before ticking the box.
Accounting, IFRS and audit
The basis of the tax is the accounting: without orderly books there is no correctly calculated Corporate Tax. The main rules:
- Financial statements under IFRS (or IFRS for SMEs within its limits).
- Audited financial statements when revenue for the year exceeds AED 50,000,000.
- Retention of records and documentation for the statutory periods, also for those applying reliefs or below the threshold.
This is where most small companies fail: they operate for years without formal accounting and the first Corporate Tax period forces them to rebuild it. Our accounting and finance team runs the full cycle — monthly bookkeeping, closing, financial statements and audit support — aligned with the tax return.
Transfer pricing and related-party transactions
The Corporate Tax incorporates a transfer pricing regime based on the arm’s length principle: transactions with related parties and connected persons (including the owner) must be priced at market value and, above certain thresholds, documented and disclosed in a specific form alongside the return.
For an SME with a single owner this translates into something very concrete: the owner’s salary, loans between the owner and the company, and services between companies in the same group must have documentary support and a defensible valuation.
Penalties: what arriving late costs
The penalty regime (Cabinet Decision No. 75 of 2023) provides for fines for late registration, for filing outside the deadline, for failing to keep records, and surcharges on unpaid tax. The specific amounts are updated by administrative decision, so it is advisable to check them on the FTA portal when planning.
The practical reading is simple: the cost of complying on time is far lower than the cost of regularising late, and almost all penalties in the first periods come from two avoidable mistakes — not registering on time and not having the accounting ready by month nine.
How we manage it at LorcaBase
We treat the Corporate Tax as an annual cycle, not a last-minute formality:
- Registration and diagnosis — registration on EmaraTax, review of the structure (companies, free zone, group) and of the tax calendar for the year.
- Accounting aligned with the tax — IFRS chart of accounts, monthly closing and control of items with specific tax treatment.
- Closing and return — tax adjustments, applicable reliefs, related-party disclosure form where required, filing and payment within the 9 months.
- International coordination — tax residency, treaties and the owner’s home-country obligations, coordinated with our UAE tax residency service.
If your company is already incorporated and has not yet registered, or year end is approaching without the accounting up to date, now is the time to put it in order.
Sources and references
References used to contextualise this page and its main data points.
Federal Decree-Law No. 47 of 2022 on Corporate Tax▸
https://mof.gov.ae/wp-content/uploads/2022/12/Federal-Decree-Law-No.-47-of-2022-EN.pdf
Cabinet Decision No. 75 of 2023 on Administrative Penalties (Corporate Tax)▸
Ministerial Decision No. 73 of 2023 on Small Business Relief▸
Legislation
FTA Corporate Tax Guide: Accounting Standards and Interaction with Corporate Tax▸
Glossary
Key terms to interpret this service correctly.
Taxable Person▸
Legal entity or individual subject to UAE Corporate Tax, whether resident or a non-resident with a nexus in the country.
Corporate Tax TRN · Tax Registration Number▸
Tax registration number issued by the FTA upon completing Corporate Tax registration. It is different from the VAT TRN.
Taxable Income · Beneficio imponible▸
Accounting profit for the year adjusted under the Corporate Tax law: exemptions, non-deductible expenses, transfer pricing and specific rules.
Small Business Relief▸
Optional relief for residents with revenue of up to AED 3,000,000 per financial year, available for periods ending on or before 31 December 2026.
Arm's Length Principle · Principio de plena competencia▸
Rule requiring transactions with related parties to be priced at market value, the basis of the UAE transfer pricing regime.
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View service→Frequently asked questions
What is the UAE Corporate Tax?
It is the federal tax on business profits introduced by Federal Decree-Law No. 47 of 2022. It applies to financial years starting on or after 1 June 2023 and is administered by the Federal Tax Authority (FTA).
How much Corporate Tax do you pay in Dubai?
The general rate is 9% on the portion of taxable profit that exceeds AED 375,000 in the financial year. The portion up to that threshold is not taxed at the general rate.
Who has to register for Corporate Tax?
All UAE companies — mainland and free zone — and, in general, individuals carrying on business activity above the regulatory threshold. Registration with the FTA issues a Corporate Tax Tax Registration Number (TRN).
My company is in a free zone. Is it taxed too?
Free zone companies are within the scope of the tax: they must register, keep accounting records and file a return. Their specific treatment depends on qualification requirements that should be reviewed case by case against the rules in force.
When is the Corporate Tax return filed?
A single return is filed within 9 months of the end of the financial year, together with the payment. There are no advance instalments.
What is Small Business Relief?
An optional relief for residents with revenue of up to AED 3,000,000 in the financial year and in the eligible previous years, available for periods ending on or before 31 December 2026: the company is treated as having no taxable profit, although it must still register and file.
What accounting does the Corporate Tax require?
The tax base starts from the accounting profit prepared under IFRS (or IFRS for SMEs where applicable). With revenue above AED 50,000,000, audited financial statements are required.
What happens if I register or file late?
The penalty regime under Cabinet Decision No. 75 of 2023 provides for fines for late registration, for failing to file the return and for failing to keep records, plus surcharges on unpaid tax. It is advisable to check the current amounts on the FTA portal.
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