VAT
Corporate Tax
Accounting & CFO
What will corporate tax cost you?
The first AED 375,000 of taxable income is charged at 0% and everything above it at 9%. Put your figures in below and you will see the split, the effective rate, and whether Small Business Relief would wipe the bill out entirely.
How the rate actually works
On taxable income up to AED 375,000. Every taxable person gets this, and it is a slice rather than a cliff — earning more does not cost you the band.
On taxable income above AED 375,000. A company with AED 500,000 of taxable income pays 9% on AED 125,000 — AED 11,250, an effective rate of 2.3%.
Revenue at or below this can elect to be treated as having no taxable income at all, for tax periods ending on or before 31 December 2029.
The effective rate is what surprises people. Because the first AED 375,000 is always free, a profitable small company pays far less than 9% overall. It only approaches 9% as taxable income grows large enough for the free band to stop mattering.
Small Business Relief was extended to 2029
Relief was originally set to end with tax periods closing on 31 December 2026. Ministerial Decision No. 131 of 2026 amended the original decision and extended it to tax periods ending on or before 31 December 2029. If you were planning around the older date, that planning is worth revisiting.
The conditions that matter:
- Revenue at or below AED 3,000,000 in the tax period you are claiming for — and in every previous period since the regime began. Cross it once and you lose relief for good, not just for that year.
- You must elect it. Relief is claimed in your corporate tax return for each period. Nobody applies it on your behalf, and forgetting to elect means paying the tax.
- You still register and still file. Relief removes the tax, not the compliance. Missing the return still triggers the late filing penalty.
- Qualifying Free Zone Persons cannot elect it, nor can members of multinational groups above the consolidated revenue threshold.
Where the estimate stops being reliable
This calculator takes your taxable income as given, and that is the hard part. Taxable income is not your accounting profit. It starts there and then moves for things like disallowed entertainment costs, the interest limitation, related-party transactions that have to be priced at arm's length, exempt dividend income, and losses carried forward from earlier periods.
For a simple trading company with clean books, the gap is small. For a group with intercompany charges, a director's loan, or foreign income, the gap can be the whole answer. If any of that sounds like you, treat the figure above as a starting point for a conversation rather than a number to budget against.
Common questions
When is the tax actually due?
The return and the payment are both due nine months after the end of your tax period. For a 31 December year end that is 30 September. Late filing costs AED 500 a month for the first year and AED 1,000 a month after that, and unpaid tax carries 14% a year charged monthly.
Do I have to register even if I will pay nothing?
Yes. Registration is separate from liability, and the AED 10,000 late registration penalty applies regardless of whether you end up owing any tax. A company electing Small Business Relief still registers and still files a return.
Does the AED 375,000 band apply per company or per group?
Per taxable person, in the ordinary case. Groups that form a tax group are treated as a single taxable person and get one band between them, which is one reason forming a tax group is a decision worth modelling rather than defaulting into.
Do I need audited accounts?
Audited financial statements are required above a revenue threshold, and for qualifying free zone persons regardless of size. Below that, proper records are still mandatory and have to be kept for seven years. We can tell you which side of the line you sit on in a few minutes.
Want the number you can actually budget against?
Send us your management accounts on WhatsApp and we will work out your real taxable income, tell you whether electing Small Business Relief is the right call, and confirm your filing deadline. If you would rather we handled the whole thing, we file corporate tax returns as a fixed fee.
Rates and thresholds on this page come from Federal Decree-Law No. 47 of 2022 on the Taxation of Corporations and Businesses, with Small Business Relief under Ministerial Decision No. 73 of 2023 as amended by Ministerial Decision No. 131 of 2026. This tool applies the headline rate to a taxable income figure you supply and does not compute taxable income itself. It is not tax advice, and only the Federal Tax Authority can determine your liability. OwnYourCFO is an independent firm of accountants and is not affiliated with or acting on behalf of the Federal Tax Authority.
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OwnYourCFO is an independent firm of accountants licensed in Ajman Free Zone, United Arab Emirates, serving clients in Dubai, Abu Dhabi and across the UAE. We are not affiliated with, endorsed by, or acting on behalf of the Federal Tax Authority or any government body. Businesses are free to deal with the Federal Tax Authority directly themselves. Our fees are for professional services only and are separate from any government charge.