What is Corporate Tax in UAE
The UAE Ministry of Finance introduced a Corporate Tax on business profits, effective June 1, 2023. This tax reform aims to promote small and medium enterprises by implementing an introductory statutory tax rate of 9% on corporate profits exceeding AED 375,000 ($102,000). In contrast, profits below that threshold will be exempt from taxation. Compliance with corporate tax regulations is mandatory for all applicable companies in the UAE, including filing annual tax returns and maintaining proper accounting records following the relevant laws and regulations.
The corporate Tax in UAE was introduced to assist the UAE in achieving its strategic goals and hasten its growth and transition. With the UAE’s vast network of double tax treaties, the assurance of a competitive corporate tax structure that complies with international norms would solidify the UAE’s position as a top business and investment location. Given the UAE’s status as a worldwide financial and economic center, the UAE Corporate Tax Code draws on best practices worldwide and contains well-recognized and respected concepts. As a result, the UAE Corporate Tax Law is ensured to be clear in its ramifications and easy to understand.