The calculation runs: Accounting Net Profit + Non-Deductible Expenses − Exempt Income − Available Reliefs = Taxable Income. Non-deductible additions include: entertainment expenses above the 50% threshold, non-business expenses, fines and penalties, and certain interest costs. Exempt income deductions include: qualifying dividends, qualifying capital gains, and free zone qualifying income. The first AED 375,000 of taxable income is taxed at 0%; income above that is taxed at 9%. Taxable income for individuals conducting business activities follows the same framework.
See also: Corporate Tax (CT), Net Profit, Small Business Relief, Free Zone Person (Qualifying)
