Corporate Tax in the UAE

Corporate Tax in UAE

The UAE introduced corporate taxation on June 1, 2023, marking one of the biggest changes in the country’s financial system and creating a new framework for businesses to understand tax rules and available corporate tax exemptions.

To help businesses adjust, Dhanguard offers clear and reliable corporate tax services so companies can manage this transition without confusion. This new tax system brings the UAE in line with international standards and supports long-term economic growth.

By choosing Dhanguard, you get a smooth and compliant tax filing process. Our team guides you through corporate tax return requirements, handles the full corporation tax filing process, and keeps you updated on new rules as they develop.

What Is Corporate Tax?

Corporate tax is a direct tax on a business’s income or profit. In many countries it’s also known as business tax or corporation tax. The UAE’s move from a 0% rate to a 9% corporate tax rate is a major shift and reflects the country’s commitment to expanding its revenue sources and meeting global economic standards.

To file correctly and avoid penalties, businesses need to understand the corporate tax process, available corporate tax exemptions, and how the rules apply to them. With help from an experienced corporate tax accountant, this becomes much easier.

Taxable income is worked out from the net profit or loss shown in your company’s financial statements. If your business makes a loss, you’re allowed to carry forward up to 75% of that loss and use it to reduce your taxable income in future years. This helps lower your tax burden and makes your corporate tax return more efficient, especially when planning ahead for future filings.

Corporate Tax History in UAE

For many years, the UAE was known as a low-tax environment. Corporate tax applied only to international banks and companies in the oil and gas sector. As the economy grew, the government saw the need for a proper tax structure to support development in areas like infrastructure, healthcare, and education.

Milestones that led to today’s system include:

• 2018: A 5% VAT was introduced on goods and services.
• 2022: The UAE announced the launch of a corporate tax system, effective June 1, 2023.
• 2023: Corporate tax became mandatory for businesses earning more than AED 375,000 per year, with a standard 9% tax rate.

This change improves fairness, discourages tax evasion, and aligns the UAE with global taxation practices. Dhanguard’s corporate tax consultants in Dubai are fully trained to help businesses understand these rules and manage their tax filings smoothly.

Corporate Tax System in UAE

Most companies with taxable income must pay corporate tax, including LLCs, PSCs, PJSCs, and LLPs. Free zone companies can still benefit from certain corporate tax exemptions as long as they follow regulations and avoid doing business with UAE mainland companies.

Corporate Tax Rates:

• 0% on taxable profits up to AED 375,000
• 9% on taxable profits above AED 375,000
• 15% for multinational corporations earning over EUR 750 million

With Dhanguard’s support, businesses can calculate their tax liabilities accurately, understand everything related to corporate tax in Dubai, and stay fully compliant with UAE tax laws.

Free Zone Tax Regulations

Companies operating in UAE free zones can still enjoy tax exemptions, which remain one of the biggest advantages of setting up in these areas. However, if a free zone business conducts any transactions with the mainland, it must register for corporate tax and complete the required corporation tax filing. This keeps the business compliant with UAE laws while still allowing it to benefit from free zone incentives.

Dhanguard’s corporate tax service helps free zone companies understand their responsibilities under the new system. Our corporate tax consultants in Dubai guide businesses through every step of the process, making sure they meet all requirements related to corporate tax in Dubai while maximizing the benefits available to them.

Process of Corporate Tax Filing

The corporate tax filing process in the UAE involves a few important steps that every business must follow:

1. Business Registration: All companies must register for corporate tax with the UAE Federal Tax Authority before they begin filing.
2. Financial Record-Keeping: Accurate and organized financial records are needed to work out your taxable income.
3. Tax Calculation: Businesses must calculate how much tax they owe based on their annual profits.
4. Tax Submission: The corporate tax return must be submitted through the official FTA portal.
5. Payment: The calculated tax amount must be paid on time to avoid penalties.

Dhanguard’s team supports you at every stage. Our experienced corporate tax consultants in Dubai help businesses stay compliant, file correctly, and understand all the requirements related to corporate tax in Dubai.

How Dhanguard Helps You with Corporate Tax Services

Dhanguard makes corporate tax simple for businesses of all sizes. We offer full support so you stay compliant with UAE rules. Here’s what we do:

• Corporate Tax Return Filing: We prepare and file your tax return accurately and on time.
• Small Business Tax Support: Affordable services designed to help small businesses meet all tax requirements.
• Tax Planning and Advice: Our corporate tax consultants in Dubai guide you with smart tax-saving strategies and explain everything related to corporate tax in Dubai.
• Financial Record Management: We help you maintain clear and organized financial records for easy tax calculation.
• Tax Liability Calculation: Our team calculates how much tax you need to pay, including any corporate tax exemptions you qualify for.
• Free Zone Compliance: We help free zone businesses follow the rules while enjoying the available tax exemptions.
• Tax Registration Assistance: We manage your entire tax registration process and help you obtain your corporate tax certificate.
• Compliance Monitoring: We keep an eye on deadlines and make sure your business stays compliant throughout the year.
• Audit Support: If you face a tax audit, we help with documentation and respond to authority queries.

Connect with us for more guidance, support, and stress-free corporate tax services.