From News Desk
Photo courtesy – Towfiqu Barbhuiya/Unsplash
In a significant policy shift, the United Arab Emirates has officially implemented a corporate tax of 9% on business profits exceeding AED 375,000, effective from June 1, 2023. The move is designed to align the UAE with international tax standards while continuing to attract foreign investment and boost economic transparency.
The new tax regime applies to mainland companies and certain free zone entities, with provisions to support small businesses and promote compliance. Key exemptions include qualifying free zone income, personal income, real estate investments by individuals, and income from natural resource extraction.
According to KGRN Chartered Accountant, Dubai, a leading provider of tax advisory and accounting services in the region, “This corporate tax law represents a monumental step in the UAE’s evolution as a globally respected business hub. Our team is fully equipped to help companies of all sizes meet the new tax requirements smoothly and efficiently.”
Key Highlights
- 9% tax on business profits over AED 375,000
- Small business relief and exemptions for qualifying entities
- Mandatory registration through the EmaraTax portal
- Transfer pricing compliance and documentation now essential
- Applicable to financial years starting on or after June 1, 2023
Companies operating in Dubai are advised to assess their financial statements, review intra-group transactions and work with experienced tax consultants to ensure timely compliance.
The Federal Tax Authority (FTA) continues to release guidance to help entities understand their obligations, especially as corporate tax audits are expected to be more frequent in the coming years.
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