Supporting You With Corporate Tax Compliance
Supporting Small Businesses in the UAE with Registration, Consultation and Corporate Tax Filing
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Trusted by 500+ Businesses
Our Method to Ensure Your Peace of Mind
Corporate Tax Registration
First step to compliance is registration. Ensuring this is correctly completed is imperative to prevent penalties. Our team will ensure supporting documentation is in order to enable a smooth registration process.
Corporate Tax Consulting
Our tax experts and partners will dive deep into your business to understand the parts of your business most as risk with compliance. Our team will ensure your business is tax efficient and will support any process changes required.
Corporate Tax Software
Tax compliance and preparation should not be a manual process without audit trails. Our software partners will provide solutions which pulls data from your accounting system to prepare your tax return with a few clicks. You will also have full transparency on your calculation.
Corporate Tax Audit and Submission
Our tax experts and partners manage multiple clients ranging from varied industries and can draw from their comprehensive experience in tax compliance from Saudi Arabia and the UK. Rest assured our service will ensure are full compliance with Corporate tax
What is UAE Corporate Tax?
UAE Corporate Tax is a federal tax on the net profit of businesses operating in the UAE. It applies to most UAE-registered companies, with specific reliefs and exemptions set out in the law.
After you calculate your accounting profit, adjustments are made to arrive at taxable income. Tax is charged on that amount above the profit threshold, with different rules for free zone companies, groups, and international income – which is why many founders choose to work with a specialist firm to stay compliant.
Is your business already in UAE Corporate Tax?
UAE Corporate Tax now applies to most mainland and free zone companies. The real question is whether your business is already in scope and what you must do next. We help you:
• Confirm if you are subject to UAE Corporate Tax
• Register correctly on EmaraTax
• Prepare clean books for your first corporate tax return
Not sure where you stand? Book a free call with our corporate tax team.
What is the UAE Corporate Tax Rate?
The CT rates are
- 0% for taxable income up to AED 375,000;
- 9% for taxable income above AED 375,000;
and a different tax rate for large multinationals that meet specific criteria set with reference to ‘Pillar Two’ of the OECD’s (Organisation for Economic Cooperation and Development’s) Base Erosion and Profit Shifting project.
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FAQs about Corporation Tax UAE
What is the Corporate Tax rate for UAE?
- 0% for taxable income up to AED 375,000
- 9% for taxable income above AED 375,000
There is also a different tax rate for large multinationals that meet specific criteria set with reference to ‘Pillar Two’ of the OECD’s (Organisation for Economic Cooperation and Development’s) Base Erosion and Profit Shifting project.
When Does Corporate Tax in the UAE come into effect?
Corporate tax is effective from 1st of June 2023 and it is expected that filing and payment deadlines will be 9 months after the financial year end.
Are Free Zone businesses subject to UAE Corporate Tax?
Companies operating in Free Zones will be subject to UAE Corporate Tax, but the UAE Corporate Tax regime will continue to apply incentives offered to free zone businesses (providing they comply with the regulatory requirements and do not conduct business with mainland UAE).
Entities operating in Free Zones will be subject to a 0% CT rate on their taxable income. If an entity located in a Free Zone derives non-passive income from mainland UAE all its income will be subject to the general CT regime.
Are Foreign Businesses Subject to UAE Corporation Tax?
To qualify for the 9% annual tax rate a foreign company operating in UAE has
- Their Permanent Establishment (PE); or
- Their Place of Effective Management; or
- Their source of income.
Do Small Businesses need to pay UAE Corporate Tax?
On the 1st of June 2023, the corporate tax rate will be 9% of the net profit made by businesses in the UAE. In order to support small businesses and start-ups, the corporate tax rate will be 0% if the net profit is up to AED 375,000.
How can I prepare my business to comply with the UAE Corporate Tax laws?
The best way to prepare for the new Corporate Tax is to have accounting software which covers all the necessary requirements. The best accounting software for businesses currently is Xero Accounting software.
What is the periodicity of filing corporate tax return?
Corporate Tax return is to be filed annually. Accordingly,
- Entities whose financial year-end is 31 May should file their CT return for the financial year-ending 31 May 2024
- Entities whose financial year-end is 30 September should file their CT return for the financial year-ending 30 September 2024
- Entities whose financial year-end is 31 December should file their CT return for the financial year-ending 31 December 2024
How will the taxable income be calculated?
The taxable income will be calculated after making specified adjustments or exceptions to accounting net profit and tax losses, if any can be carried forward to subsequent fiscal years and set off against the taxable income for the respective year.
Who is responsible for the administration and collection of Corporate Tax in UAE?
The Federal Tax Authority (FTA) will be the responsible and regulatory authority for the enforcement, collection of tax and administration of the Corporate Tax in UAE.
Which businesses will be covered under Corporate Tax?
Corporate Tax covers all businesses incorporated in UAE except those involved in the production of natural resources but including businesses incorporated in Free zones and not operating or conducting business with the UAE mainland but excluding branches of foreign banks.
Will tax holidays continue to apply to free zone entities?
Free zones in the UAE offer various incentives including tax-free periods of up to 50 years. This will continue to be honored under the Corporate Tax regime for free zone entities that comply with the relevant regulatory requirements and do not conduct business with mainland UAE.
Will entities involved in oil and gas activities, currently subject to UAE corporate taxation?
Corporate Tax does not cover businesses incorporated in UAE involved in the production of natural resources. However, service companies in UAE that are part of a multinational group involved in the production of natural resources are expected to be within the scope of UAE CT.
Will branches of foreign banks currently subject to CT at an Emirate level, be impacted on transition to the new CT regime?
As per the Corporate Tax FAQs issued by Ministry of UAE, foreign corporate income tax paid on income that is taxable in the UAE will be allowed as a CT credit in the UAE.
Will CT apply to government-owned entities?
The FAQs on Corporate Tax issued by the Ministry of Finance in UAE have not mentioned any exemptions to entities owned by the UAE government. However, it can be said that government owned entities whose principal purpose is to fulfil a government function and not conduct business will be exempt from the Pillar Two rules under the CT regime in UAE.
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