Corporate Tax UAE

Efficient and dependable tax compliance services to strengthen your business in UAE.

Corporate Tax UAE

The implementation of corporate tax in the UAE has begun on June 1, 2023. As per the legislation of the Federal Tax Authority (FTA), taxable businesses have been subjected to a 9% corporate tax starting from their first fiscal year that begins on or after June 1, 2023.

Taxable Income Rates

  • 0% for taxable income up to AED 375,000
  • 9% for taxable income exceeding AED 375,000

Freezone Tax Rates

  • 0% on qualifying income
  • 9% on income other than qualifying income

Net Gain for Qualifying Free Zone Entity:

The net profit earned by a Qualifying Free Zone business from international or Free Zone activities within the UAE is termed as “Qualifying Income”.

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Adhering to regulations is crucial for accessing advantages

Navigating a new tax system can be tricky. With Brightlink’s support, you can confidently manage UAE corporate taxes, boosting your business profits and succeeding in this dynamic market.

  • Maintain a Positive Reputation: Following regulations shows integrity to stakeholders like investors and partners, building trust and a good image.
  • Avoid Penalties and Fines: Non-compliance can result in significant fines and penalties, affecting your finances and possibly delaying future plans.
  • Peace of Mind for Growth: Efficient tax handling allows you to concentrate on essential business tasks, reducing the chance of unexpected tax issues.

What are the steps for the UAE corporate tax registration?

The Federal Tax Authority has introduced the “EmaraTax” platform for online pre-registration.

EmaraTax provides various online services like registrations, returns, refunds, deregistrations, VAT payments, and corporate tax management.

The first step is to either create an account on EmaraTax or transfer the existing FTA Account to the platform.

To register for corporate tax, it’s necessary to submit all required documents according to UAE corporate tax regulations.

Brightlink Consulting: Your Ultimate Partner for Corporate Tax UAE

Our skilled team has a solid record in handling the intricacies of UAE corporation tax law, especially for new businesses in the region. We are committed to offering unwavering support and ongoing professional assistance to achieve your business objectives. Our comprehensive solutions include:

  1. Tax Audit Representation
  2. Tax Compliance Management
  3. Corporate Tax Registration
  4. Transfer Pricing Policy Development
  5. Optimizing Tax Strategies
  6. Ensuring Legal Compliance
  7. Minimizing Tax Liabilities

Frequently Asked Questions: Corporate Tax UAE

Corporate Tax is a form of direct tax levied on the net income or profit of corporations and other businesses. Corporate Tax is sometimes also referred to as “Corporate Income Tax” or “Business Profits Tax” in other jurisdictions.

A competitive Corporate Tax regime based on international best practices is expected to cement the UAE’s position as a leading global hub for business and investment and accelerate the UAE’s development and transformation to achieve its strategic objectives.

Introducing a Corporate Tax regime also reaffirms the UAE’s commitment in meeting international standards for tax transparency and preventing harmful tax practices.

Most countries in the world have a comprehensive Corporate Tax regime, including most of the countries in the Middle East.

The UAE Corporate Tax regime is effective for Financial Years starting on or after 1 June 2023.

Examples:

  • A Business that has a Financial Year starting on 1 July 2023 and ending on 30 June 2024 is subject to UAE Corporate Tax from 1 July 2023 (which is the beginning of the first Financial Year that starts on or after 1 June 2023).
  • A Business that has a Financial Year starting on 1 January 2023 and ending on 31 December 2023 will become subject to UAE Corporate Tax from 1 January 2024 (which is the beginning of the first Financial Year that starts on or after 1 June 2023).

Yes. The application of UAE Corporate Tax does not differentiate between entities that are locally or internationally owned.

Juridical persons that are incorporated or resident in the UAE, or foreign entities that have a Permanent Establishment or taxable nexus in the UAE, will be subject to UAE Corporate Tax irrespective of the residence and nationality of the individual founders or (ultimate) owners of the entity.

Yes. The UAE Corporate Tax is a federal tax and will therefore apply across all the Emirates.

Businesses engaged in the extraction of the UAE’s Natural Resources and in certain non-extractive activities that are subject to Emirate level taxation will be outside the scope of UAE Corporate Tax, subject to meeting certain conditions.

Other businesses may be subject to both Corporate Tax and Emirate level taxation. Emirate level taxes paid will not be able to be credited against or otherwise reduce the amount of Corporate Tax Payable.

No, Corporate Tax and VAT are two different types of taxes. Both will apply in the UAE.

If you are a registered business for VAT, you will have to pay VAT and Corporate Tax separately. If your business is not registered for VAT you may still have to pay Corporate Tax.

Corporate Tax and Excise Tax are two different types of taxes. Both will apply in the UAE.

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