Corporate Tax
Al-Hisab Tax Consultancy offers premier Corporate Tax Services in the UAE, guided by a team of expert consultant’s adept at managing tax assessment, registration, and return filing. We deliver comprehensive support to help you seamlessly integrate into the new tax framework, optimizing efficiency and ensuring thorough management of your corporate tax responsibilities.
What is Corporate Tax?
Typically, corporate taxes are calculated based on a business’s accounting net profit or income, with adjustments made for specific items as outlined by UAE Corporate Tax Law.
The UAE introduced Corporate Tax on June 1, 2023. The tax rate is set at 9% for taxable profits exceeding AED 375,000, with profits up to AED 375,000 taxed at 0%. This structure is designed to support small and medium-sized enterprises (SMEs).
The corporate tax rate in the UAE will be applied as follows:
For Example, If the company/establishment earns a taxable profit AED 500,000 in a Financial Year, the taxable Obligation will be calculated as follows:
- Taxable income of AED 0 – AED 375,000 at 0% =AED 0
- A part of taxable income exceeding AED 375,000 (e.g. AED 400,000 -AED 375,000 = AED 25,000) at 9% = AED 2,250
Will Free Zones Be Impacted by Corporate Tax?
Corporate tax will affect businesses operating within the free zones of the UAE. However, businesses that comply with regulatory requirements and do not engage in activities within Mainland UAE will continue to benefit from corporate tax advantages. Free zones are required to register and file corporate tax returns accordingly.
Exempt Person
The following persons shall be exempt from CT:
- a) A Government entity.
- b) A Government-controlled entity.
- c) A person engaged in an extractive business.
- d) A person engaged in a non-extractive natural resource business.
- e) A qualifying public benefit entity.
- f) A qualifying investment fund; g) A public / private pension or social security fund.
- h) A juridical person incorporated in the UAE that is wholly owned and controlled by an exempt person specified in (a), (b), (f) and (g) under certain conditions.