UAE corporate tax applies to all UAE-resident businesses and foreign companies with a permanent establishment in the UAE. The rate structure is: 0% on taxable income up to AED 375,000, and 9% on taxable income above that threshold. Free zone companies may qualify for a 0% rate on qualifying income if they meet the Qualifying Free Zone Person criteria. The Small Business Relief election allows businesses with revenue below AED 3 million to treat their taxable income as zero — but this must be actively elected and cannot be assumed. Late registration for corporate tax carries a penalty of AED 1,000.
Watch out: Corporate tax registration is mandatory for all UAE businesses — even those that expect to pay zero tax. Failure to register, not failure to pay, is the first compliance trigger.
See also: Taxable Income, Small Business Relief, Free Zone Person (Qualifying), Corporate Tax Return
