Who Must Comply With Corporate Tax in Dubai?
The UAE corporate tax was introduced under Federal Decree-Law No. 47 of 2022 and applies to financial years starting on or after 1 June 2023. Dubai follows the same federal regime as the rest of the UAE. Corporate tax applies to almost every business that operates in Dubai, whether on the mainland or in a free zone.
The following are treated as taxable persons and must comply:
- Companies incorporated in the UAE, including mainland LLCs and free zone entities.
- Foreign companies that have a permanent establishment or are effectively managed and controlled in the UAE.
- Natural persons (individuals) carrying on a business or business activity in the UAE whose total turnover exceeds AED 1 million in a Gregorian calendar year, such as sole proprietors and freelancers.
- Dormant, newly incorporated and loss-making companies that still hold a live trade licence, which usually must register and file a nil return.
Corporate Tax Rates in Dubai (2026)
Corporate tax in Dubai is charged on net accounting profit after specified adjustments. The current rates are:
| Category | Taxable income / income type | Rate |
| Standard regime | Up to AED 375,000 | 0% |
| Standard regime | Above AED 375,000 | 9% |
| Qualifying Free Zone Person | Qualifying income | 0% |
| Qualifying Free Zone Person | Non-qualifying income | 9% |
| Large multinational groups | Consolidated revenue of EUR 750 million or more (from years starting 1 Jan 2025) | 15% (DMTT) |
The 15% figure is the Domestic Minimum Top-up Tax (DMTT) under Cabinet Decision No. 142 of 2024, which applies only to in-scope multinational enterprise groups. Most Dubai businesses fall under the 0% and 9% regime.
How to Comply With Corporate Tax in Dubai: Step by Step
Follow these nine steps to meet every corporate tax obligation and avoid FTA penalties.
Step 1: Confirm Whether Your Business Is a Taxable Person
Start by establishing your status under the law. Review your trade licence, legal form, place of management and, for individuals, your annual business turnover against the AED 1 million threshold. Free zone companies should also identify whether they might qualify as a Qualifying Free Zone Person (QFZP). This first assessment determines your registration deadline, your applicable rate and the reliefs you can claim.
Step 2: Register With the FTA on EmaraTax
Every taxable person must register for corporate tax on the FTA’s EmaraTax portal (emaratax.gov.ae) and obtain a Corporate Tax Registration Number. There is no paper option. You will typically need your trade licence, Emirates ID and passport copies of owners and authorised signatories, Memorandum of Association, contact details and, where a representative acts for you, a valid power of attorney.
Registration deadlines are set by FTA Decision No. 3 of 2024:
- Existing mainland companies register according to the month their trade licence was first issued, regardless of profit.
- Entities incorporated on or after 1 March 2024 must register within three months of incorporation.
- Natural persons who cross the AED 1 million turnover threshold must register by 31 March of the following Gregorian year.
Missing the registration deadline triggers an AED 10,000 penalty. A time-limited FTA waiver initiative can cancel or refund this penalty if the first corporate tax return is filed within seven months of the end of the first tax period (FTA public clarification CTP006, issued 2 July 2025). Because this window is time-sensitive, confirm current eligibility on tax.gov.ae before relying on it.
Step 3: Maintain Compliant Accounting Records
Corporate tax is built from your financial statements, so accurate books are essential. Prepare accounts under International Financial Reporting Standards (IFRS). Businesses with revenue of AED 50 million or below may use IFRS for SMEs. Audited financial statements are mandatory for businesses with revenue above AED 50 million and for Qualifying Free Zone Persons.
The accrual basis of accounting is the general rule; the cash basis is permitted only where turnover is AED 3 million or below. All records and supporting documents must be kept for at least seven years from the end of the tax period to which they relate.
Step 4: Assess Your Free Zone (QFZP) Position
Free zone businesses can access the 0% rate on qualifying income only if they meet every Qualifying Free Zone Person condition throughout the tax period. These conditions include maintaining adequate economic substance in the UAE, earning qualifying income, applying the arm’s length principle to related-party transactions, preparing audited financial statements, and not electing to be treated under the standard regime.
A key test is the de minimis rule: non-qualifying revenue must not exceed the lower of 5% of total revenue or AED 5 million. Breaching any condition can cause the entity to lose QFZP status and be taxed at 9%. In 2026, FTA checks on QFZP status have become more detailed, so documentation matters.
Step 5: Apply Any Reliefs You Are Entitled To
Small Business Relief lets a resident taxable person elect to be treated as having no taxable income where revenue is AED 3 million or below in the current and all previous tax periods. The election is made on the corporate tax return. This relief is currently scheduled to end after 31 December 2026. Other mechanisms, such as foreign tax credits and transfers within a qualifying group, may also reduce liability. Assess these before you calculate final tax.
Step 6: Calculate Your Taxable Income
Begin with accounting net profit, then apply the adjustments required by the Corporate Tax Law. Common adjustments include adding back non-deductible expenses, applying the interest deductibility limit, excluding exempt income such as qualifying dividends, and accounting for related-party and transfer-pricing adjustments. Apply the 0% band to the first AED 375,000 of taxable income and 9% to the remainder to arrive at the tax payable.
Step 7: File the Corporate Tax Return and Pay on Time
Corporate tax returns are filed electronically on EmaraTax. You submit one return per year and pay in full within nine months of the end of your financial year. There are no instalments or advance payments. For a business with a financial year ending 31 December 2025, both the return and the payment are due by 30 September 2026. Filing without paying, or paying without filing, are both treated as non-compliance.
Step 8: Meet Transfer Pricing Obligations
Transactions with related parties and connected persons must follow the arm’s length principle. Depending on the size of the group and the value of related-party transactions, you may need to prepare a disclosure form, a Local File and a Master File, and retain the supporting analysis. Getting transfer pricing right protects both mainland and free zone businesses during an FTA review.
Step 9: Stay Ahead of New Rules and Ongoing Duties
Compliance is continuous. Two 2026 developments matter for planning. First, the penalty framework was restructured under Cabinet Decision No. 129 of 2025, effective 14 April 2026, introducing a flat 14% per annum late-payment penalty and more favourable voluntary-disclosure terms. Second, mandatory electronic invoicing is being phased in: businesses with revenue of AED 50 million or more must appoint an Accredited Service Provider by 31 July 2026, with mandatory e-invoicing for that group from 1 January 2027. Building these into your calendar keeps you compliant year after year.
Corporate Tax Deadlines and Penalties in Dubai (2026)
| Obligation | Deadline | Penalty for non-compliance |
| Corporate tax registration | Per FTA Decision No. 3 of 2024 (licence-month schedule; 3 months for new entities) | AED 10,000 |
| Corporate tax return filing | Within 9 months of financial year-end | AED 500 per month for 12 months, then AED 1,000 per month |
| Corporate tax payment | Within 9 months of financial year-end | 14% per annum on unpaid tax (from 14 April 2026) |
| Record keeping | Retain for 7 years | Fixed penalties for failure to keep records |
For corporate tax, the 14% annual late-payment rate has applied since Cabinet Decision No. 75 of 2023; Cabinet Decision No. 129 of 2025 brought VAT and Excise Tax into line with the same rate and simplified the wider framework.
Common Corporate Tax Compliance Mistakes to Avoid
- Assuming a 0% rate or QFZP status removes the duty to register or file. It does not.
- Missing the registration deadline because it is tied to the licence-issue month, not to profit.
- Treating dormant or loss-making companies as exempt from filing.
- Filing the return but not paying by the same nine-month deadline, or vice versa.
- Weak transfer-pricing documentation for related-party transactions.
- Losing QFZP status by breaching the de minimis rule or economic substance conditions.
How BCL Globiz Helps You Comply
BCL Globiz is a corporate tax specialist based in Dubai and part of the BCL Group. The firm is registered with the Department of Economic Development under licence 1072657, brings more than 35 years of combined group expertise, and serves over 1,000 clients across more than 20 industries. It is a recognised Zoho Books partner and has been named among Intuit QuickBooks’ Finest 15 Global Accounting Firms.
BCL Globiz supports businesses across the full compliance cycle:
- Corporate tax registration on EmaraTax and FTA correspondence.
- IFRS-compliant accounting, bookkeeping and audit-ready records.
- Taxable income computation, return preparation and on-time filing.
- Free zone and QFZP assessment, Small Business Relief and reliefs planning.
- Transfer pricing advisory and documentation.
- Ongoing compliance support, penalty-waiver guidance and FTA representation.
Frequently Asked Questions
Do free zone companies in Dubai pay corporate tax?
Free zone companies still register and file. They pay 0% only on qualifying income and only if they meet all Qualifying Free Zone Person conditions, including the de minimis rule. Non-qualifying income is taxed at 9%.
What is the corporate tax registration deadline in Dubai?
It depends on your entity type. Existing mainland companies follow the licence-issue-month schedule under FTA Decision No. 3 of 2024, new entities register within three months of incorporation, and qualifying individuals register by 31 March of the following year. Late registration carries an AED 10,000 penalty.
When is the corporate tax return due in Dubai?
Both the return and the payment are due within nine months of your financial year-end. A business with a year ending 31 December 2025 must file and pay by 30 September 2026.
Do I have to file if my business owes no tax?
Yes. Filing is mandatory for every registered taxable person, including businesses in the 0% band, those electing Small Business Relief, dormant companies and Qualifying Free Zone Persons. A nil return is still required.
What happens if I pay corporate tax late in Dubai?
From 14 April 2026, unpaid tax attracts a flat 14% per annum penalty under Cabinet Decision No. 129 of 2025, calculated monthly until settled. A late-filing penalty may also apply.
Can small businesses reduce their corporate tax in Dubai?
A resident business with revenue of AED 3 million or below can elect Small Business Relief, which treats it as having no taxable income. The election is made on the return and the relief is currently scheduled to end after 31 December 2026.
