In a groundbreaking shift, the UAE government introduced corporate taxation effective from June 1, 2023. This move marks a pivotal transformation in the nation’s fiscal policy landscape. At BrightFuture, we’re equipped to help you navigate this new reality with confidence, precision, and strategic insight.
Why Choose BrightFuture?
Let BrightFuture lead you through the UAE’s evolving tax model. Together, we’ll build your path to continued success.
What is Corporate Tax?
Corporate tax is a direct tax levied on the net income or profit of corporations and similar entities. Globally known as corporation or business tax, it is typically imposed at the national level. For decades, the UAE maintained a 0% corporate income tax, positioning itself as an attractive tax haven. However, the introduction of a 9% corporate tax signifies a strategic shift towards economic diversification and long-term sustainability.
Historically, the UAE did not impose corporate taxes on most businesses—only foreign banks and resource extraction companies were taxed. The majority of government revenue stemmed from the fossil fuel sector. However, with a strategic move toward economic diversification and reduced reliance on oil, the UAE introduced a 5% VAT in 2018 and followed up with the 9% corporate tax, officially declared on January 31, 2022.
This corporate tax aims to:
Corporate Tax Rates
Companies with fiscal years starting in January will only begin paying corporate tax for income earned after January 1, 2024.
Entities subject to the new tax regulations include:
Exempt Entities
Certain businesses and organizations remain exempt from the tax, including:
Taxable income is based on the net profit/loss stated in audited financial statements. Companies with net losses can carry forward up to 75%of losses to offset future taxable income.
While Free Zones maintain their tax incentives, they must:
Businesses that remain within Free Zone parameters will continue to benefit from 0% corporate tax.
No Personal Income Tax: The UAE does not tax salaries, wages, or freelance income.
No Capital Gains Tax: Dividends and capital gains earned by individuals are not subject to tax in Dubai or across the UAE.
The corporate tax introduction is designed to:
As the UAE embarks on this new chapter, BrightFuture stands ready to guide businesses through each step. Our corporate tax experts provide:
Stay ahead of the curve with BrightFuture—your partner in seamless corporate tax compliance.
A 9% tax on business profits, effective June 1, 2023, applicable to income over AED 375,000 (~USD 100,000).
All UAE-resident businesses and certain foreign entities operating in the UAE.
Government entities, qualifying investment funds, charities, and businesses in extractive industries.
Only if they generate income from the UAE mainland or violate Free Zone conditions.
No. The UAE does not currently impose capital gains or personal income tax.
It enhances global credibility, attracts investment, and supports long-term economic growth.
Contact BrightFuture—and let’s build a compliant, competitive, and prosperous business environment together.
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