Calculate UAE Corporate Tax for standard businesses, Free Zone QFZP companies, and Small Business Relief — per FTA rules.
UAE Corporate Tax is 0% on the first AED 375,000 of taxable income and 9% above that. On AED 2,000,000 profit, the CT is AED 146,250 (effective 7.31%). Free Zone QFZP companies pay 0% on qualifying income. Small businesses (revenue ≤ AED 3M) can elect for 0% until end 2026.
| Taxable Income | 0% Bracket | 9% Bracket | CT Payable | Effective Rate |
|---|---|---|---|---|
| AED 375,000 | AED 375,000 | AED 0 | AED 0 | 0% |
| AED 500,000 | AED 375,000 | AED 125,000 | AED 11,250 | 2.25% |
| AED 1,000,000 | AED 375,000 | AED 625,000 | AED 56,250 | 5.63% |
| AED 2,000,000 | AED 375,000 | AED 1,625,000 | AED 146,250 | 7.31% |
| AED 5,000,000 | AED 375,000 | AED 4,625,000 | AED 416,250 | 8.33% |
| AED 10,000,000 | AED 375,000 | AED 9,625,000 | AED 866,250 | 8.66% |
Effective rate approaches 9% as income increases. The AED 375K 0% bracket benefits smaller businesses most.
| Feature | Standard Business | Free Zone QFZP |
|---|---|---|
| Qualifying income rate | 9% (above AED 375K) | 0% |
| Non-qualifying income | 9% | 9% (mainland UAE sales) |
| Small Business Relief | Yes (≤ AED 3M revenue) | Yes |
| Filing deadline | 9 months after FY end | 9 months after FY end |
| Substance requirements | Standard | Must meet FZ substance rules |
The UAE introduced Corporate Tax effective June 2023, making it one of the last major economies to implement a corporate income tax. The standard rate is 9% on taxable income exceeding AED 375,000. Income up to AED 375,000 is taxed at 0%, providing meaningful relief for smaller businesses. The UAE CT rate remains among the lowest globally — well below the OECD average of ~23%.
Small Business Relief allows businesses with revenue of AED 3 million or less to elect for 0% CT for tax periods ending on or before 31 December 2026. Free Zone businesses qualifying as QFZP pay 0% on qualifying income (foreign-source and inter-FZ transactions) and 9% only on non-qualifying domestic income, subject to substance requirements. Use our UAE Gratuity Calculator for employee end-of-service benefits.
0% on taxable income up to AED 375,000 and 9% on income above that. QFZP companies pay 0% on qualifying income. MNEs may face a 15% Pillar Two top-up.
First AED 375,000 at 0% = AED 0, remaining AED 1,625,000 at 9% = AED 146,250. Effective rate: 7.31%.
QFZP companies pay 0% on qualifying income and 9% on non-qualifying income (mainland UAE sales), provided substance requirements are met.
Revenue ≤ AED 3M businesses can elect for 0% CT for tax periods ending on or before 31 December 2026.
Within 9 months of the end of the financial year. Calendar-year businesses: 30 September of the following year.
No. UAE has no personal income tax. CT applies only to business profits. Employment income and personal investment returns remain tax-free.
Dividends and capital gains from UAE subsidiaries (qualifying participation), foreign PE income, natural resource extraction income, and personal investment income of individuals.
Income up to AED 375,000 is taxed at 0%, so small businesses with moderate profits pay very little CT. This applies per taxable person, not per activity.
If your revenue is ≤ AED 3M, elect for SBR to pay 0% CT. This election is available for tax periods ending on or before 31 Dec 2026. You still need to register and file.
QFZP status requires adequate substance in the Free Zone — employees, office space, and decision-making within the FZ. Failing substance tests means 9% on all income.
CT return and payment are due within 9 months of your financial year end. Late filing incurs penalties. Register with the FTA via the EmaraTax portal before your first filing deadline.
Related-party transactions must be at arm's length. Businesses with revenue over AED 200M and/or related-party transactions over AED 40M must file a Transfer Pricing Disclosure Form.
UAE CT law requires businesses to maintain accounting records and supporting documents for 7 years. Use proper accounting software to stay compliant.