UAE corporate tax: the essentials for a small company
The rates, thresholds and deadlines that matter to a founder or small company, each with its official source. For your own situation, have your obligations confirmed by a registered tax adviser.
The key figures
| Item | Rule | Source |
|---|---|---|
| Rate | 0% on taxable income up to AED 375,000, 9% above. | u.ae · Corporate tax ↗ |
| In force since | Financial years starting on or after 1 June 2023 (Federal Decree-Law No. 47 of 2022). | u.ae · Corporate tax ↗ |
| Small businesses | Annual revenue up to AED 3 million: simplified obligations, for tax periods ending on or before 31 December 2029. | MoF · Small Business Relief ↗ |
| Registering a new company | Within three months of incorporation. | FTA · Decision No. 3 of 2024 ↗ |
| Late registration penalty | AED 10,000. | FTA · Late registration penalty ↗ |
| Return and payment | No later than nine months after the end of the tax period. | FTA · Filing deadline ↗ |
Small Business Relief
- Extended to 2029
Ministerial Decision No. 131 of 2026, announced on 7 August 2026, extends the relief to tax periods ending on or before 31 December 2029. It lets businesses with annual revenue up to AED 3 million benefit from simplified compliance, subject to conditions.
MoF · Small Business Relief ↗ - You still file
Businesses claiming the relief must still file their return within nine months of the end of the period.
FTA · Filing deadline ↗
Free zones: 0% under conditions
- The principle
A Qualifying Free Zone Person pays 0% on qualifying income and 9% on other income.
FTA · Free Zone Person bulletin ↗ - The conditions
Adequate substance in the free zone, qualifying income, no election for the standard rate, arm’s-length pricing with transfer pricing documentation, and audited financial statements.
FTA · Free Zone Person bulletin ↗ - The de minimis rule
Non-qualifying revenue must not exceed the lower of AED 5 million or 5% of total revenue.
FTA · Free Zone Person bulletin ↗
Registration and penalties
- Deadlines
A company set up since March 2024 registers within three months of incorporation. A natural person above the threshold registers by 31 March of the following year.
FTA · Decision No. 3 of 2024 ↗ - Penalty waiver
The FTA waives the AED 10,000 penalty if the first return is filed within seven months of the end of the first tax period. The initiative was still running in May 2026, with no announced end date.
FTA · Penalty waiver ↗
What probably does not apply to you
- Top-up tax for large groups
The Domestic Minimum Top-up Tax targets multinational groups with global revenue of €750 million or more, for financial years starting on or after 1 January 2025. A small company is not concerned.
MoF · Domestic Minimum Top-up Tax ↗
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