UAE Corporate Tax: 9% Rate, AED 375,000 Band, Small Business Relief

The rates

UAE corporate tax applies to tax periods starting on or after 1 June 2023. The Federal Tax Authority (FTA) general guide sets two rates on taxable income:

Part of taxable income	Rate
Up to AED 375,000	0%
Above AED 375,000	9%

Only the part above the band is taxed. On AED 1,000,000 of taxable income, the tax is (1,000,000 − 375,000) × 9% = AED 56,250. The FTA’s own example is AED 6,000,000 of taxable income, which gives (6,000,000 − 375,000) × 9% = AED 506,250.

Try your own figures in the corporate tax calculator.

Taxable income is not the same as profit

Taxable income starts from the accounting net profit in the financial statements, with certain adjustments set by the Corporate Tax Law. The calculator asks for taxable income, so any adjustments must be made first.

Who pays

The rules cover companies and other legal entities, and also individuals who run a business. Employment income is outside the scope of corporate tax, so ordinary salaries are not taxed. The FTA guide says corporate tax applies to a natural person only when their business or business activities bring in more than AED 1,000,000 in a calendar year.

Small Business Relief

A resident business with revenue of AED 3,000,000 or less in the tax period and in every earlier tax period can elect to be treated as having no taxable income, so it pays no corporate tax. Key points from the FTA’s Small Business Relief guide:

• It applies to tax periods that end on or before 31 December 2026.
• Revenue means the gross income of the period, not profit, measured under the accounting standards accepted in the UAE.
• Once revenue goes above AED 3,000,000 in any period, the business cannot elect the relief later, even if revenue falls back.
• It is not available to members of a multinational group (consolidated revenue over AED 3.15 billion) or to Qualifying Free Zone Persons.
• The business must still register, file a simplified tax return and keep records.

Deadlines

The tax return must be filed, and the tax paid, within nine months of the end of the tax period.

Free zone companies

A free zone company that meets the conditions of a Qualifying Free Zone Person is taxed at 0% on qualifying income and 9% on other income, and it cannot use Small Business Relief. These rules have several conditions, so this site’s calculator does not model them. Ask an accountant.

Corporate tax and VAT

They are separate taxes. VAT is 5% on goods and services, and corporate tax is on business income. See the VAT guide.

Sources: UAE Federal Tax Authority, Corporate Tax General Guide (CTGGCT1) and Small Business Relief guide (CTGSBR1). Checked 2 October 2026. This is general information, not tax advice.