Guide
What is the UAE corporate tax rate? 0%, 9% and who pays
Updated
There are two headline rates and one threshold. Almost every complication in UAE corporate tax is about what counts as taxable income, not about the rate applied to it.
The rates in the law
Article 3 of the Corporate Tax Law charges corporate tax on taxable income at 0% on the portion not exceeding an amount set by the Cabinet, and 9% on the portion above it. Cabinet Decision No. 116 of 2022 sets that amount at AED 375,000. The UAE Government's own summary states the same two rates (u.ae).
The rate applies to financial years beginning on or after 1 June 2023, which is when the law took effect (Ministry of Finance).
Who is a taxable person
- UAE companies and other juridical persons incorporated in the UAE, or effectively managed and controlled here.
- Natural persons conducting a business or business activity in the UAE, as specified by Cabinet Decision.
- Non-resident juridical persons with a permanent establishment in the UAE.
- Juridical persons established in a UAE free zone, which are within scope as taxable persons even where they end up paying 0% on qualifying income.
Who is exempt
The Ministry of Finance lists exempt persons in four groups: automatically exempt government entities and specified government-controlled entities; extractive and non-extractive natural resource businesses, exempt on notification to the Ministry; qualifying public benefit entities listed in a Cabinet Decision; and pension funds, qualifying investment funds and certain wholly-owned subsidiaries, exempt on application to and approval by the Federal Tax Authority.
The separate 15% charge on large groups
The UAE domestic minimum top-up tax is a different tax from the 9% corporate tax. It applies to constituent entities of multinational groups with annual global revenues of EUR 750 million or more in the ultimate parent's consolidated accounts in at least two of the four preceding financial years, and it took effect for financial years starting on or after 1 January 2025. Cabinet Decision No. 142 of 2024 defines the minimum rate as fifteen percent.
This regime is new and has been amended more than once. Confirm the current position on the Federal Tax Authority and Ministry of Finance websites before filing.