Region: United Arab Emirates
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United Arab Emirates · Tax, accounting & company complianceThe UAE has no personal income tax. Your company still registers for Corporate Tax, and often VAT, with the FTA.

We work with founders and SMEs setting up on the mainland or in a free zone, and with overseas groups running UAE companies, on incorporation, Corporate Tax and VAT registration, EmaraTax returns and IFRS books.

Book a consultation9 services in the UAE

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Tax year
Your own financial year (Corporate Tax)
Currency
UAE dirham (AED)
Main authorities
FTA · MoF · DET · FZA
Services
9 covered on this site
A Gulf businessman in a white thobe and red-and-white shemagh with a black agal works on his phone at a round white table with a laptop, printed invoices and an open book, a colleague in a dark suit standing beside the table
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Tax year

Your own financial year (Corporate Tax)

The system in brief

How the UAE taxes a business.

The UAE does not tax individuals on salaries or personal investment income. Businesses are different. Federal Corporate Tax, under Federal Decree-Law No. 47 of 2022, applies to financial years starting on or after 1 June 2023, and VAT has been charged at 5% since 1 January 2018.

Both taxes are run by the Federal Tax Authority (FTA) through its online portal, EmaraTax. The Ministry of Finance sets tax policy and issues the Cabinet and ministerial decisions that fill in the detail, and several of those changed in 2025 and 2026.

Licensing is separate and local. A mainland company is licensed by the economic department of its emirate, such as the Department of Economy and Tourism (DET) in Dubai. A free zone company is licensed by its free zone authority under that zone’s own rules.

The choice between mainland and free zone affects where you can trade, what the licence costs and how Corporate Tax applies to your income. It does not change whether you need to register with the FTA: every UAE company does.

A Corporate Tax period is normally the business’s financial year, and most companies use the calendar year to 31 December. The return and any tax are due within 9 months of the period end. VAT runs on separate tax periods set by the FTA, usually quarterly and monthly for some larger businesses, with returns due 28 days after each period ends.

Who you’ll deal with

The authorities, and what each one wants.

Knowing which body handles what saves a great deal of time. These are the ones most UAE businesses meet.

  • FTA

    Federal Tax Authority

    Registers businesses for Corporate Tax and VAT, receives returns and payments through EmaraTax, and carries out tax audits and penalties.

  • MoF

    Ministry of Finance

    Sets federal tax policy and issues the ministerial decisions on rules such as Small Business Relief, free zone qualifying activities, audit requirements and e-invoicing.

  • DET

    Dubai Department of Economy and Tourism (and other emirates’ economic departments)

    Licenses mainland companies in Dubai, approves trade names and activities, and renews licences; each other emirate has its own economic department doing the same job.

  • FZA

    Free zone authorities (for example DMCC, IFZA or RAKEZ)

    Each free zone licenses and registers the companies in its zone under its own regulations, fees and annual filing rules. The examples are for illustration, not endorsement.

  • MOHRE

    Ministry of Human Resources and Emiratisation

    Registers mainland employers, issues work permits and runs the Wage Protection System for mainland payroll; free zones handle their own employment registrations.

How it works

What a business owner in the UAE needs to understand.

  1. 01

    A trade licence is not a tax registration

    The licence from DET or a free zone authority lets you operate. It does not register you with the FTA. Every UAE company must register for Corporate Tax, even with no taxable profit, and a new company has 3 months from incorporation to apply. Late registration carries an AED 10,000 penalty at the time of writing.

  2. 02

    Corporate Tax: 0% up to AED 375,000, 9% above

    Taxable income up to AED 375,000 is taxed at 0% and the rest at 9%, at the time of writing. The return and payment are both due 9 months after the tax period ends. Multinational groups with global revenue of EUR 750 million or more also face a 15% domestic minimum top-up tax from 2025.

  3. 03

    Small Business Relief now runs to 2029

    Resident businesses whose revenue is AED 3 million or less, in the current and every earlier period, can elect to be treated as having no taxable income. Ministerial Decision No. 131 of 2026 extended the relief to tax periods ending on or before 31 December 2029. It is claimed in a filed return, and is not open to Qualifying Free Zone Persons or large multinational groups.

  4. 04

    A free zone licence does not guarantee 0%

    A Qualifying Free Zone Person pays 0% on qualifying income and 9% on the rest, but only while it meets every condition: adequate substance in the zone, qualifying income, audited financial statements, transfer pricing compliance, and non-qualifying revenue below the lower of 5% or AED 5 million. Failing one costs the status for 5 tax periods.

  5. 05

    VAT is triggered by turnover, at AED 375,000

    Registration is mandatory once taxable supplies and imports over the past 12 months exceed AED 375,000, or are expected to in the next 30 days. Voluntary registration is possible above AED 187,500. Since 1 January 2026, self-invoicing under the reverse charge is no longer required and refunds of excess VAT must be claimed within 5 years.

  6. 06

    E-invoicing and record keeping are tightening

    Under Ministerial Decisions No. 243 and 244 of 2025, businesses with revenue of AED 50 million or more must issue e-invoices through an accredited service provider from 1 January 2027, and most others from 1 July 2027 (at the time of writing). Corporate Tax records must be kept for at least 7 years after the tax period ends.

United Arab Emirates services

What we handle in the UAE.

Business & Incorporation

Tax

Accounting

Compare with the same services in other countries

United Arab Emirates

No personal income tax, but Corporate Tax and VAT still need registering, filing and records.

First-year roadmap

From trade licence to your first Corporate Tax return

Most new UAE companies go through the same steps in roughly the same order. Some happen with the licensing authority, some with the FTA, and a few depend on your turnover, your free zone and whether you claim 0%.

This assumes a new company with a calendar year end. First tax periods can be shorter or longer than 12 months, and at the time of writing the FTA waives the late registration penalty if the first return is filed within 7 months of the end of the first tax period. We map the sequence for your company at the start.

Talk it through with us

  1. Choose the jurisdiction and activities

    Decide between mainland, a free zone or a branch, and pick licence activities that match what the business will actually do. The activities affect approvals, office rules, visa numbers and, in a free zone, whether income can qualify for 0%.

    DET or free zone authority

  2. Reserve the name and obtain the licence

    The trade name is reserved, any initial approvals obtained, and the memorandum and articles of association signed. Corporate shareholders’ documents usually need attesting before they are accepted.

    DET or free zone · trade licence and MOA

  3. UBO register, establishment card and bank account

    The company records its ultimate beneficial owners and files the details with its registrar. An establishment card is needed before sponsoring visas, and the bank account application follows, with the bank applying its own checks.

    Registrar · immigration · your bank

  4. Register for Corporate Tax

    New companies must register within 3 months of incorporation under FTA Decision No. 3 of 2024, even if they have not traded. The FTA issues a Corporate Tax registration number and records the first tax period.

    FTA · EmaraTax

  5. Register for VAT

    Mandatory within 30 days once taxable supplies and imports pass AED 375,000 over 12 months, or are expected to in the next 30 days. Voluntary registration is possible above AED 187,500.

    FTA · EmaraTax · VAT TRN

  6. Keep books that support both taxes

    Accruals-based books under IFRS, or IFRS for SMEs where revenue is AED 50 million or less, feed the VAT returns, the financial statements and the Corporate Tax computation.

    IFRS or IFRS for SMEs

  7. File VAT returns

    Each VAT 201 return, and any VAT due, must reach the FTA by the 28th day after the tax period ends. Most businesses file quarterly.

    FTA · VAT 201

  8. Close the year and arrange any audit

    Prepare the financial statements. Audited statements are needed for Corporate Tax if revenue is above AED 50 million, if you claim Qualifying Free Zone Person status, or for a tax group, and many free zones ask for them at renewal.

    Registered auditor where required

  9. File the Corporate Tax return and pay

    The return, any Small Business Relief election and any transfer pricing disclosure are filed on EmaraTax, and tax is paid by the same date. For a 31 December year end that is 30 September.

    FTA · EmaraTax

Choosing a structure

Mainland company, free zone company or branch: how the main UAE options compare

ComparedMainland companyFree zone companyBranch of a foreign company
Licensing authorityThe emirate’s economic department, e.g. DET in DubaiThe free zone authorityEmirate economic department or free zone, depending on location
OwnershipUp to 100% foreign for most activities; some strategic activities restricted100% foreign ownership allowedWholly owned by the parent; not a separate legal entity
Where it can tradeAnywhere in the UAE, including government contractsWithin the zone and abroad; mainland sales usually need a distributor or permitOnly the parent’s licensed activities, where it is licensed
Corporate Tax0% up to AED 375,000, 9% above; Small Business Relief possible0% on qualifying income if every QFZP condition is met; otherwise as mainlandTaxed as the parent’s permanent establishment on profits attributable to it
VATStandard rules and thresholdsStandard rules; special treatment for goods in designated zonesRegisters as the foreign company once thresholds apply
Typical fitSelling to UAE customers, retail, local servicesInternational trade, holding, regional headquartersEstablished foreign groups extending an existing business
Rules differ between emirates and between free zones, and ownership limits depend on the activity. We compare the options against your customers and income before you apply, and confirm current rules with the authority.

Common situations

What’s involved, case by case.

Illustrative composites of situations we’re commonly asked about. They aren’t client stories, and your own circumstances may change what applies.

Scenario 01

A Pakistani IT company opening a free zone entity in Dubai

A software house in Lahore wants a Dubai free zone company to sign contracts with Gulf clients, hold the regional team’s visas and receive payment in dirhams and dollars. The setup agent’s quote mentions 0% Corporate Tax.

What’s involved

  • Checking whether software and IT services income is qualifying income, which for most services to clients outside the free zone it is not
  • Comparing Qualifying Free Zone Person status with Small Business Relief, which QFZPs cannot use
  • Corporate Tax registration within 3 months of incorporation, whatever the tax outcome
  • Pricing work between the Lahore company and the Dubai entity at arm’s length
  • Pakistani tax and reporting on the foreign company, which needs its own advice

How we help

We test the income against the free zone rules before the licence is chosen, register the company with the FTA, and set up books and intercompany agreements that support whichever Corporate Tax position applies.

Scenario 02

A UK e-commerce brand setting up a mainland company

A UK skincare brand selling online wants a Dubai mainland company so it can hold stock locally, sell to UAE consumers through its own site and regional marketplaces, and take payments through a local gateway.

What’s involved

  • A mainland licence with e-commerce and trading activities, and customs registration for imports
  • VAT registration once taxable supplies and imports pass AED 375,000, and import VAT at the border
  • Marketplace and gateway payouts split into gross sales, fees and refunds
  • Corporate Tax registration, and whether Small Business Relief applies in the first years
  • Keeping the UK VAT and Corporation Tax position separate from the UAE one

How we help

We coordinate the licence with a setup agent, register for Corporate Tax and VAT at the right time, and build the bookkeeping around the store, marketplace and gateway reports so every VAT 201 comes straight from the books.

Scenario 03

A consultant whose revenue may qualify for Small Business Relief

An independent management consultant runs a one-person Dubai company with revenue of around AED 1.2 million a year. They assumed Corporate Tax did not apply to them and have not registered.

What’s involved

  • Registering for Corporate Tax late, and whether the penalty waiver can still apply
  • Checking revenue in every period against the AED 3 million Small Business Relief limit
  • Electing the relief in each Corporate Tax return, and giving up loss carry-forward in those years
  • VAT registration, since revenue is well above AED 375,000
  • Records kept for 7 years, even while no Corporate Tax is payable

How we help

We register the company, file the first return in time for the waiver where possible, make the Small Business Relief election, and bring VAT and bookkeeping into line.

Scenario 04

A US-owned subsidiary with intercompany charges

A US software group has a Dubai mainland subsidiary that sells to Gulf customers. The parent charges a management fee and a licence fee for its platform, and the local team wants to know what the Corporate Tax return needs.

What’s involved

  • Arm’s length pricing for the management and licence fees, with written intercompany agreements
  • The transfer pricing disclosure form, if related-party transactions pass the FTA’s thresholds
  • Whether revenue triggers audited financial statements or a master file and local file
  • Reporting packs for the parent alongside IFRS statements for the UAE
  • US reporting on the foreign subsidiary, which the parent’s US advisers handle

How we help

We review the intercompany charges at a practical level, prepare the IFRS statements and the Corporate Tax computation, and complete the disclosure form. Formal transfer pricing studies are scoped separately.

Key dates

Deadlines in the UAE, month by month.

Corporate Tax dates run from your own financial year and VAT dates from the tax periods the FTA assigns, so we set them out as a calendar for your business. The e-invoicing dates are one-off milestones set by ministerial decision and have already been adjusted once, so we check them each time we review your position.

Deadlines that follow your own year end or filing period

  • Period end + 28 daysVAT return (VAT 201) and paymentVAT-registered businesses (most file quarterly)

    The VAT return and any VAT payable must reach the FTA by the 28th day after the tax period ends. If that day is a weekend or public holiday, the FTA generally moves it to the next working day.

  • Year end + 9mCorporate Tax return and paymentAll companies registered for Corporate Tax, including free zone companies

    The Corporate Tax return is filed on EmaraTax and the tax paid within 9 months of the end of the tax period. For a 31 December year end, that is 30 September.

  • Incorporation + 3mCorporate Tax registrationNew UAE companies and branches

    Companies incorporated on or after 1 March 2024 must register within 3 months of incorporation. Foreign companies with a UAE permanent establishment have 6 months from when it began.

  • Year end + 9mTransfer pricing disclosure formCompanies with related-party or connected-person transactions

    Filed with the Corporate Tax return where transactions with related parties or payments to connected persons pass the FTA’s thresholds (AED 40 million in total related-party transactions at the time of writing).

  • Year end + 9mSmall Business Relief electionResident businesses with revenue of AED 3 million or less

    The relief is claimed in the Corporate Tax return for each tax period. It is available for periods ending on or before 31 December 2029 where revenue is AED 3 million or less.

  1. January

    1 deadline
    • 1E-invoicing goes live for large businesses (2027)United Arab Emirates · Businesses with revenue of AED 50 million or more

      From 1 January 2027, businesses with revenue of AED 50 million or more must issue and receive B2B and B2G invoices through the e-invoicing system. Consumer sales are outside it for now.

  2. March

    1 deadline
    • 31Corporate Tax registration for individuals in businessUnited Arab Emirates · Sole establishments, freelancers and other individuals trading in their own name

      An individual whose turnover from business activities exceeded AED 1 million in a calendar year must register by 31 March of the following year. Salary and personal investment income do not count.

  3. July

    1 deadline
    • 1E-invoicing for other businesses (2027)United Arab Emirates · Businesses with revenue below AED 50 million

      Businesses below AED 50 million must appoint an accredited service provider by 31 March 2027 and go live by 1 July 2027. Government entities follow on 1 October 2027.

  4. October

    1 deadline
    • 30E-invoicing: appoint a service provider (2026)United Arab Emirates · Businesses with revenue of AED 50 million or more

      Businesses with revenue of AED 50 million or more must appoint an accredited service provider by 30 October 2026, after the Ministry of Finance extended the original 31 July deadline.

  5. December

    1 deadline
    • 31Last date to claim older VAT credit balances (2026)United Arab Emirates · VAT-registered businesses with unclaimed refund balances

      Since 1 January 2026, excess VAT must be reclaimed within 5 years of the end of the tax period. Balances already older than that can be claimed under a transitional rule until 31 December 2026.

Worth knowing

What we can’t do, said plainly.

Knowing a firm’s limits is as useful as knowing its services. Where something needs a lawyer, a licensed signature or an authority’s decision, we say so early.

  1. 01

    We are accountants and tax advisers, not lawyers. Bespoke memoranda, shareholder agreements and disputes should be handled by a UAE-qualified lawyer.

  2. 02

    We are not a licensing authority or a government services (PRO) provider. Licence, establishment card, visa and immigration steps are coordinated with licensed setup agents, and residence questions depend on the immigration authorities.

  3. 03

    Banks decide whether to open or keep an account on their own compliance criteria. We can prepare the file, but we can’t guarantee the outcome.

  4. 04

    Free zone rules, fees and annual filing requirements vary by authority. Where an audit is required, the opinion must come from an independent registered auditor, not from us as preparers.

  5. 05

    Figures, thresholds and dates here reflect our understanding in September 2026. Several reforms are still being phased in, so we confirm the current position when we scope your work.

Questions

United Arab Emirates: frequently asked.

Answers to what clients in the UAE ask us most. Each service page has more detailed questions.

All FAQs

Is there personal income tax in the UAE?

No. Salaries and personal investment income are not taxed. Individuals running a business in their own name are the exception: once business turnover exceeds AED 1 million in a calendar year, they register for Corporate Tax.

Do I pay Corporate Tax in a free zone?

Possibly not on all of your income, but you still register and file a return. A Qualifying Free Zone Person pays 0% on qualifying income and 9% on the rest, provided it meets every condition, including substance, audited accounts and the de minimis limit. Many service businesses selling outside the zone do not qualify.

Do I need to register for Corporate Tax if I earn below AED 375,000?

Yes. Every UAE company must register, whatever its profit, and file a return each year. The first AED 375,000 of taxable income is taxed at 0%, and Small Business Relief may reduce the tax to nil for revenue up to AED 3 million.

Should I set up on the mainland or in a free zone?

It depends on where your customers are and what you sell. The mainland suits businesses selling to UAE customers or the government; free zones suit international trade, holding and specific sectors, but mainland sales usually need a distributor or permit and 0% only applies to qualifying income.

Can a foreigner own 100% of a UAE company?

In most cases, yes. Free zones have always allowed full foreign ownership, and since 2021 most mainland activities can be 100% foreign-owned too. A short list of strategic activities still has restrictions, which we check against your activities.

Do I need to register for VAT?

You must if your taxable supplies and imports over the last 12 months exceed AED 375,000, or are expected to in the next 30 days. You can register voluntarily above AED 187,500. Both thresholds are the position at the time of writing.

What records must I keep, and for how long?

Keep accounting records, invoices, contracts, bank statements and working papers that support your returns. Corporate Tax requires at least 7 years after the end of the tax period and VAT at least 5, with longer periods for some real estate records.

What if I registered for Corporate Tax late?

The late registration penalty is AED 10,000 at the time of writing. The FTA currently waives it if the first Corporate Tax return is filed within 7 months of the end of the first tax period, so it is worth acting quickly.

Across borders

Working across more than one country?

Many clients have obligations in two or three of these systems at once. One team keeps them on a single calendar.

Speak with a consultant

Tell us about your UAE licence, VAT and Corporate Tax position.

Pick the closest match and we’ll take it from there. You’ll get a written scope and fee before any work begins.

Or use our three-step guide, or email hello@fiscorra.com

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