What Is UAE Corporate Tax?
UAE Corporate Tax (CT) was introduced under Federal Decree-Law No. 47 of 2022 and represents a significant shift in the UAE's tax landscape. It is a direct tax levied on the net profit of businesses operating in the UAE, calculated at the end of each financial year and reported via an annual tax return submitted to the Federal Tax Authority (FTA).
The CT framework applies the following rates:
| Taxable Income Band | CT Rate | Notes |
|---|---|---|
| Up to AED 375,000 | 0% | Applies to all taxable persons |
| Above AED 375,000 | 9% | Standard rate on excess amount |
| Qualifying Free Zone Income | 0% | Subject to meeting QFZP conditions |
| Large Multinationals (OECD Pillar Two) | 15% | Global minimum tax top-up rate |
CT is computed on the taxable income of the business — broadly, accounting net profit adjusted for specific additions and deductions defined in the law. The tax is self-assessed: the business prepares its own CT return, computes the liability, and pays the amount due to the FTA within 9 months of the financial year end.
MEG Taxagent manages the full CT compliance cycle on your behalf — from initial registration through to annual return filing — ensuring accurate computations and on-time submissions.
Who Must Register for Corporate Tax?
The UAE Corporate Tax law requires registration with the FTA for a broad range of entities and individuals. Understanding who must register — and by when — is critical to avoiding penalties.
Entities Required to Register
- All UAE-incorporated companies — whether mainland (LLC, sole establishments, civil companies) or free zone entities (FZE, FZCO, Branch)
- Foreign companies with a permanent establishment (PE) in the UAE or that are effectively managed and controlled from the UAE
- Natural persons (individuals) conducting business or business activity in the UAE with annual turnover exceeding AED 1 million
- Non-resident persons earning UAE-sourced income (state-sourced income)
Entities Exempt from Corporate Tax
- UAE Government entities and government-controlled entities (as listed by the Ministry of Finance)
- Qualifying public benefit organisations (charities, foundations approved by the Cabinet)
- Qualifying investment funds (subject to specific conditions)
- Pension and social security funds established in the UAE
- Individuals earning only employment income, personal investment income, or income from real estate (not through a business)
⚠️ Important: All entities must register — even if exempt or at the 0% rate.
The FTA requires registration for Corporate Tax purposes regardless of whether your business is subject to tax. Failure to register on time results in an administrative penalty of AED 10,000. MEG Taxagent handles your CT registration efficiently via EmaraTax.
MEG Taxagent conducts a full business assessment before registration to confirm your entity type, financial year, applicable exemptions, and any free zone qualification status — ensuring your CT registration is accurate from day one.
Our Corporate Tax Services
As an FTA-accredited tax agent (TAAN 20049185), MEG Taxagent provides comprehensive corporate tax services for mainland and free zone businesses across Dubai and the UAE. Our CT service covers every stage of the compliance cycle:
- CT Registration with FTA via EmaraTax — We register your company for Corporate Tax and obtain your Tax Registration Number (TRN) before the applicable deadline.
- Annual CT Return Preparation & Filing — We prepare your corporate tax return accurately, compute your taxable income, apply eligible reliefs, and file with the FTA within the 9-month deadline.
- Financial Statements Aligned to IFRS — We prepare or review your financial statements in compliance with International Financial Reporting Standards (IFRS), which form the basis for CT computation.
- Tax Planning & Optimization — We assess eligibility for Small Business Relief (available to businesses with revenue up to AED 3 million), Qualifying Free Zone Person status, participation exemptions, and other CT incentives to legally minimise your liability.
- Transfer Pricing Documentation — For businesses with related-party transactions, we prepare the required transfer pricing documentation (local file, master file) and advise on arm's-length pricing.
- CT Health Checks & Gap Analysis — We review your current accounting records, group structure, and intercompany transactions to identify CT risks and remediation steps before filing.
- FTA Audit Representation for CT Matters — If the FTA initiates a CT audit or issues an inquiry, we represent you directly, prepare responses, and attend FTA meetings on your behalf.
- Penalty Reconsideration Applications — If your business has received an FTA penalty in connection with Corporate Tax, we prepare and submit a formal reconsideration request.
Key Corporate Tax Compliance Deadlines
Meeting CT deadlines is essential to avoid penalties. The following timeline applies to most UAE businesses:
| Compliance Obligation | Deadline | Penalty for Non-Compliance |
|---|---|---|
| CT Registration with FTA | As per FTA published deadlines (based on licence issue month) | AED 10,000 administrative penalty |
| Annual CT Return Filing | Within 9 months of financial year end | AED 500/month (months 1–12); AED 1,000/month thereafter |
| Corporate Tax Payment | Within 9 months of financial year end (same as return) | 14% per annum late payment penalty |
| Record Retention | Minimum 7 years from end of the relevant tax period | AED 10,000–20,000 per violation |
| Transfer Pricing Disclosure | Filed with the annual CT return | AED 10,000–50,000 depending on violation type |
For businesses with a January–December financial year, the first CT return and payment is due by 30 September 2025 (covering the financial year ended 31 December 2024). MEG Taxagent tracks all deadlines for your business and ensures no filing is ever missed.
Financial Year Considerations
Your CT obligations depend on your business's financial year end. Businesses are taxed on financial years — not calendar years — so a company with a June financial year end will have different filing and payment deadlines than one with a December year end. MEG Taxagent maps your specific deadlines at onboarding and manages them throughout.
Corporate Tax for Free Zone Companies
Free zone companies occupy a unique position under UAE Corporate Tax. While they are subject to CT and must register, Qualifying Free Zone Persons (QFZPs) can benefit from a 0% CT rate on their qualifying income.
What Makes a Company a Qualifying Free Zone Person?
- Incorporated or established in a UAE free zone
- Maintains adequate substance in the free zone (offices, employees, core activities)
- Earns income from qualifying activities (as defined by the Ministry of Finance)
- Does not elect to be subject to the standard 9% CT rate
- Complies with the arm's-length principle for related-party transactions
- Meets the de minimis threshold (non-qualifying income does not exceed AED 5 million or 5% of total revenue)
✅ Free Zone CT Assessment — MEG Taxagent
Many free zone companies assume they automatically qualify for the 0% rate — but the QFZP conditions are detailed and require careful analysis. MEG Taxagent conducts a full QFZP eligibility assessment and ensures your business maintains the necessary substance and documentation to defend the 0% status in an FTA audit.
Non-qualifying income of a QFZP (such as income from mainland UAE customers) is taxed at 9%. MEG Taxagent helps free zone companies correctly identify and segregate qualifying and non-qualifying income streams for accurate CT computation.
Small Business Relief
Small Business Relief (SBR) is an elective relief available to UAE resident persons whose revenue does not exceed AED 3 million in the current and all prior tax periods (from tax periods beginning on or after 1 June 2023 up to and including tax periods ending on or before 31 December 2026).
A business electing SBR is treated as having zero taxable income for the relevant tax period — effectively eliminating the CT liability for small businesses below the AED 3 million revenue threshold. The election must be made in the CT return for the relevant period.
Importantly, even businesses claiming SBR must still register for CT and file an annual CT return. The election is not automatic. MEG Taxagent assesses SBR eligibility at onboarding and applies the election where advantageous.
📑 Full Tax Agency Services — Beyond Corporate Tax
MEG Taxagent covers VAT, Excise Tax, FTA audit representation, penalty reconsiderations, and the full spectrum of UAE tax obligations — all under one TAAN-accredited roof.
View All Tax Agency Services →Why Choose MEG Taxagent for Corporate Tax?
UAE businesses trust MEG Taxagent with their Corporate Tax compliance for the following reasons:
- FTA-Accredited Tax Agent — TAAN 20049185. We are one of a limited number of agents accredited by the Federal Tax Authority to act on behalf of clients in CT matters.
- End-to-End CT Management — From registration and IFRS accounts to annual return filing and FTA audit support, we handle every stage.
- Free Zone Expertise — In-depth knowledge of QFZP conditions, qualifying income categories, and substance requirements across major UAE free zones.
- Mainland & Multi-Entity Groups — Experience with mainland LLCs, branch offices, holding structures, and tax groups under the CT law.
- Proactive Penalty Avoidance — We track all CT deadlines for your business and file on time, every time — eliminating the risk of late registration or filing penalties.
- WhatsApp Access — Direct access to our CT specialists for queries, updates, and FTA correspondence throughout the year.
- Transparent Fixed Fees — No hidden charges. Our CT service fees are agreed upfront at engagement.