How corporate tax works in United Arab Emirates
UAE corporate tax applies to resident juridical persons and branches or permanent establishments in scope. The standard federal rate is 9%, but taxable income up to AED 375,000 is taxed at 0%. Eligible resident businesses can elect small business relief where revenue is at or below AED 3 million in the relevant and prior qualifying tax periods ending on or before 31 December 2026; Qualifying Free Zone Persons and large MNE-group members cannot elect it.
The UAE also preserves important carve-outs and special rules. Qualifying Free Zone Persons can access 0% on qualifying income if the conditions are met, domestic dividends are exempt, and large multinational groups with annual global revenue of at least EUR 750 million can fall under the UAE Domestic Minimum Top-up Tax from financial years starting on or after 1 January 2025. Certain legacy emirate-level rules can still apply to extractive businesses and foreign bank branches.
Tax rates at a glance
- Corporate profits tax
- 0% / 9%0% to AED 375k
- Standard company tax
- 9%
- Small business relief
- 0%
- Qualifying free zone income
- 0%
- DMTT for large MNEs
- 15%
- Withholding tax
- 0%
Who benefits most
These profiles tend to benefit most when the rules match their real residence, payroll and business setup.
Remote foundersHolding companiesInvestorsRegional operatorsFree zone businesses
Watch out for
- The UAE has no general dividend withholding tax, but corporate tax registration and annual filing still matter.
- Free zone status does not automatically mean 0% on all income. The 0% rate is tied to qualifying income and other conditions.
- Large MNE groups should check the UAE DMTT rules carefully, and some legacy emirate-level taxes can still apply to foreign bank branches or extractive businesses.
Frequently asked questions
Does the UAE have corporate tax?
Yes. The UAE has a federal corporate tax regime with 0% on taxable income up to AED 375,000 and 9% above that for in-scope businesses, plus separate rules for large MNEs and some exempt persons.
What businesses pay corporate tax in the UAE?
Most resident companies and in-scope branches or permanent establishments do. Qualifying Free Zone Persons can get 0% on qualifying income, while extractive businesses, some government entities and certain exempt persons follow special rules.
Is the UAE good for companies?
It can be, because the standard rate is still relatively low and there is no dividend withholding tax. Companies still need to model VAT, payroll, substance, free zone conditions, transfer pricing and DMTT exposure.