BCL GLOBIZ • UAE CORPORATE TAX
Rates, compliance & expert support — from registration to annual filing. Dedicated Manager, transparent pricing, and SOP-driven delivery for 1000+ UAE businesses.
✦ Accounting & Book-keeping is included FREE in all packages · 🛡️ 100% Refund Guarantee within the first 3 months.
Corporate tax is levied on the taxable income of companies and juridical persons operating in the UAE.
It is governed by Federal Decree-Law No. 47 of 2022 and is effective for financial years starting on or after 1 June 2023.
Small businesses, startups, sole proprietors — zero liability
Mainland & freezone businesses — the standard UAE rate
Large multinationals — OECD Pillar Two (from Jan 2025)
Over 450,000 businesses have registered for corporate tax with the FTA to date. FTA audit activity has increased significantly — non-compliance is no longer a low-risk position.
The UAE’s 9% corporate tax rate is among the lowest globally — below the UK (25%), US (21%), and most EU countries. The UAE remains one of the world’s most tax-efficient business jurisdictions.
Who Pays
UAE corporate tax applies broadly. Understanding which category your business falls into determines your registration obligation, filing timeline, and applicable rate.
Worked examples
Rates mean little without context. Here are three Dubai-specific examples showing exactly how corporate tax is calculated.
Worked examples
AED 500,000 net profit
First AED 375,000 @ 0%
AED 0
Remaining AED 125,000 @ 9%
AED 11,250
QFZP (all conditions met)
AED 2M qualifying freezone income
Qualifying Free Zone Person (QFZP)
Yes
Qualifying income (FZ-to-FZ)
0%
Mainland E-Commerce
AED 1.5M net profit
First AED 375,000 @ 0%
AED 0
Remaining AED 1,125,000 @ 9%
AED 101,250
Free Zone
To qualify as a Qualifying Free Zone Person (QFZP) under UAE Corporate Tax law and benefit from the 0% rate on qualifying income, a Free Zone entity must meet ALL of the following core conditions simultaneously.
Maintain sufficient employees, assets, and operational expenses within the Free Zone. Substance cannot be nominal.
Earn income primarily from qualifying activities, keeping non-qualifying income within de minimis limits (5% of total revenue or AED 5M, whichever is lower).
Formally opt to benefit from the 0% corporate tax rate, rather than defaulting to the standard 9% regime.
Conduct all related-party transactions at arm's length and maintain proper TP documentation as required by FTA.
Prepare and maintain audited financials for each tax period.
Follow any supplementary requirements issued by the Minister of Finance from time to time.
Not all freezone income qualifies for the 0% rate. The distinction between qualifying and non-qualifying revenue is critical for QFZP status — and one of the most frequently misunderstood areas of UAE corporate tax.
9% Corporate Tax
9% Corporate Tax
0% Corporate Tax
0% Corporate Tax
De minimis threshold: Non-qualifying income must not exceed 5% of total revenue OR AED 5 million (whichever is lower). Breach this, and all income becomes taxable at 9%.
Permanent Establishments (PEs): Income attributable to domestic or foreign PEs is always taxable at 9% — it never qualifies for the 0% rate.
Immovable property: Commercial property income with Non-Free Zone Persons, and all non-commercial property income, is taxed at 9%. PE income and immovable property income are excluded from the de minimis base.
FTA-approved
Qualifying Activities are the specific business activities approved by the FTA that generate Qualifying Income eligible for the 0% corporate tax rate for QFZPs. Your freezone entity’s actual activities must fall within this list — or be ancillary to it — to benefit from the 0% rate.
Activities ancillary to the main Qualifying Activities above also qualify — provided they are genuinely supportive and not stand-alone revenue generators. BCL Globiz can assess whether your specific activity mix qualifies.
Free Zone Breakdown
Dubai’s major freezones each have distinct sector profiles and QFZP eligibility implications. The most comprehensive freezone CT breakdown available.
JAFZA
Sectors:Logistics, manufacturing, trade
Condition:Qualifying income from approved activities
Dubai Internet City
Sectors:Tech, IT, e-commerce
Condition:Activities must be within qualifying categories
Dubai Media City
Sectors:Media, publishing, marketing
Condition:Non-qualifying income taxed at 9%
Dubai Healthcare City
Sectors:Healthcare, pharma
Condition:Qualifying activities must be delineated
Free Zone Breakdown
Dubai’s major freezones each have distinct sector profiles and QFZP eligibility implications. The most comprehensive freezone CT breakdown available.
Freezone
Key Sectors
QFZP Potential
Key Condition
Transfer pricing rules require that transactions between related parties are conducted at arm’s length — on terms that independent third parties would agree to. If your Dubai business transacts with parent companies, subsidiaries, or associated persons, you have TP obligations.
Required for MNE groups with consolidated revenues of AED 3.15 billion or more.
Required if total related-party transactions exceed AED 40 million in a tax period.
For Ultimate Parent Entities of MNE groups meeting the AED 3.15B threshold.
Must accompany every CT return for entities with related-party transactions.
What non-compliance costs
FTA enforcement is intensifying. Penalties accumulate and are not negotiable. Here’s exactly what non-compliance costs.
Violation
Penalty
Notes
Failure to register for Corporate Tax
AED 10,000
Per instance; FTA notifies deadline
Late submission of CT return
AED 500/mo → AED 1,000/mo
First 12m @ AED 500; thereafter AED 1,000
Failure to maintain financial records
AED 10,000 / 20,000
Records kept 7 years minimum
Failure to submit audited financials
AED 50,000
Applies to larger entities
Incorrect CT return (no fraud)
AED 500 – AED 20,000
Based on underpaid tax amount
Tax evasion / fraudulent return
Up to 5× unpaid tax
+ criminal referral; personal liability possible
Failure to register for CT (repeat)
AED 20,000
Escalating penalty structure
Late registration carries AED 10,000 per instance. Failure to file costs AED 500/month for the first 12 months, rising to AED 1,000/month. These amounts accumulate and are not negotiable.
What non-compliance costs
FTA enforcement is intensifying. Penalties accumulate and are not negotiable. Here’s exactly what non-compliance costs.
Violation
Penalty
Failure to register for Corporate Tax
AED 10,000
Late submission of CT return
AED 500/mo → AED 1,000/mo
Failure to maintain financial records
AED 10,000 / 20,000
Failure to submit audited financials
AED 50,000
Incorrect CT return (no fraud)
AED 500 – AED 20,000
Tax evasion / fraudulent return
Up to 5× unpaid tax
Failure to register for CT (repeat)
AED 20,000
Late registration carries AED 10,000 per instance. Failure to file costs AED 500/month for the first 12 months, rising to AED 1,000/month. These amounts accumulate and are not negotiable.
Seven commitments that define how we work — and why UAE businesses choose BCL Globiz for corporate tax.
One named Manager handles
your registration, filing, and queries — not a call centre.
Direct line to your Manager. Fast responses, clear updates — no chasing required.
Every engagement follows documented procedures. Nothing falls through the gaps.
Upfront fees. No hidden charges. You know the cost before we start.
Complex dual-license structures, QFZP assessments, and multi-entity groups.
Registration to filing, transfer pricing documentation, and FTA audit support.
Registration within FTA deadlines. Filings submitted before the 9-month window closes.
Why BCL Globiz
Included in our CT service
Frequently Asked Questions
Quick answers to the questions UAE businesses ask most often. Still unsure? Our team is happy to help.
Yes. Registration is mandatory regardless of profit or loss. Non-registration carries an AED 10,000 penalty even if your taxable income is zero.
Freezone companies qualifying as QFZPs pay 0% on qualifying income. All other freezone income is taxed at 9% on profits above AED 375,000. Qualifying requires meeting substance, activity, and de minimis conditions.
The CT return must be filed within 9 months of your financial year-end. Payment is due on the same date.
The FTA has published a specific list — see the Qualifying Activities section above. Key examples include manufacturing, processing, trading of qualifying commodities, fund management, ship operations, aircraft leasing, logistics services, and headquarters services to related parties. Ancillary activities also qualify.
Per legal entity — unless your entities form an FTA-approved Tax Group, in which case the threshold applies once to the combined group.
SBR allows eligible businesses with annual revenue of AED 3 million or less to be treated as having zero taxable income. You must elect for it on your CT return. Key condition: revenue must be below AED 3 million in the current AND all prior tax periods from 1 June 2023.
Start today
Our team will review your structure, assess your CT obligations, and provide a clear action plan — at no cost. Transparent pricing, dedicated support, and a clear process from Day 1.
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