UAE Corporate Tax

UAE Corporate Tax was introduced under Federal Decree-Law No. 47 of 2022 on the Taxation of Corporations and Businesses. The Federal Tax Authority (FTA) is the body responsible for administration, registration, and enforcement. The tax applies to juridical persons incorporated in the UAE, foreign entities that are effectively managed and controlled in the UAE, and natural persons conducting business or business activity in the UAE, subject to conditions set out in the Decree-Law.\n\nFree zone persons can qualify for a preferential rate on their Qualifying Income provided they meet the conditions of a Qualifying Free Zone Person as defined in Article 18 of Federal Decree-Law No. 47 of 2022. Businesses must register with the FTA, file a Corporate Tax return, and settle any liability within the deadlines published by the FTA. Failure to register or file on time may result in administrative penalties under Cabinet Decision No. 75 of 2023.\n\nThe Decree-Law provides for a number of reliefs and exemptions - including for government entities, qualifying public benefit entities, and extractive businesses - the conditions for which are set out in Articles 4 through 9 of the Decree-Law. Businesses should review the FTA's published guidance and consult a qualified tax adviser to determine their specific registration and filing obligations.

For English-speaking expats running a business, acting as a sole trader, or holding a freelance licence in the UAE, Corporate Tax is a direct compliance obligation - not just a concern for large corporations. Natural persons conducting a business or business activity are within scope if their turnover exceeds the threshold specified by the UAE Cabinet, so expat freelancers and sole proprietors should confirm their position with a qualified cross-border adviser before each tax period.\n\nExpats who also hold tax residency in another country - such as the UK or US - should be aware that UAE Corporate Tax paid may interact with their home-country tax obligations and available treaty reliefs. The UAE has an expanding network of double taxation agreements; whether a specific treaty provides relief against Corporate Tax liabilities is a technical question that depends on the treaty text and individual circumstances. Consult a tax adviser with cross-border experience before filing in any jurisdiction. This article is not tax advice.