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For decades the United Arab Emirates (UAE) was known as a tax-free investment hub. That changed on 1 June 2023, when a federal corporate tax came into effect across all seven emirates, including Dubai. This regime directly affects profit planning, accounting infrastructure and compliance for both local and foreign businesses. In this guide we explain how corporate tax is calculated in Dubai, who is exempt, how registration and filing work, and the rates that apply for 2026.
Corporate tax is a direct federal tax levied on the net profit of companies and of individuals carrying out business activities. It applies UAE-wide, not only in Dubai. The tax is administered by the Federal Tax Authority (FTA), and all registration, filing and payment steps are handled through the FTA's digital platform, EmaraTax.
The tax is computed on taxable income, which starts from the accounting profit and is then adjusted for exempt income, non-deductible expenses, transfer pricing adjustments and other items set out in the law.
The standard regime uses a two-tier structure. The table below summarises the rates in force as of July 2026.
| Taxable Income | Corporate Tax Rate |
|---|---|
| Up to AED 375,000 | 0% |
| Portion exceeding AED 375,000 | 9% |
| Large multinational groups (annual consolidated revenue ≥ EUR 750 million) – DMTT | 15% (minimum effective rate) |
Profit up to AED 375,000 is taxed at 0%; this threshold is not a separate exemption but part of the rate structure. The portion above the threshold is taxed at 9%. From January 2025, large multinational enterprise groups with global consolidated revenue of EUR 750 million or more are subject to a 15% Domestic Minimum Top-up Tax (DMTT) under the OECD Pillar Two framework.
Corporate tax applies to UAE-incorporated legal persons, mainland companies and, under certain conditions, free zone companies. Natural persons conducting business under a UAE licence may also become taxable once they exceed a defined revenue threshold.
A large part of Dubai's appeal comes from its free zones. A free zone company that meets the conditions of a Qualifying Free Zone Person (QFZP) can benefit from a 0% corporate tax rate on its qualifying income. Non-qualifying income remains subject to the standard 9% rate.
QFZP status depends on maintaining adequate economic substance, meeting the qualifying income definition, keeping certain mainland-sourced income below de minimis limits and preparing audited financial statements. You can explore the details in our article Becoming a Qualifying Free Zone Person (QFZP) in Dubai.
Update: The United Arab Emirates has extended the Small Business Relief initiative until 31 December 2029. Eligible businesses with annual revenue of up to AED 3 million can continue to benefit from simplified Corporate Tax compliance requirements, reducing administrative burden and focusing on growth.
To ease the burden on start-ups and smaller companies, Small Business Relief allows eligible businesses to be treated as having no taxable income and pay no corporate tax for a tax period.
| Example Scenario | Revenue Situation | Outcome |
|---|---|---|
| Company A | ≤ AED 3,000,000 in all periods | Eligible for relief |
| Company B | AED 3,100,000 in one period | Not eligible |
Corporate tax registration is completed through the FTA's online platform, EmaraTax, and is mandatory for all taxable persons. After registration, the business receives a Tax Registration Number (TRN) used for all tax dealings.
For the strategic importance of registration and applicable deadlines, see our article The Importance of Corporate Tax Registration in Dubai, UAE.
Every taxable person must file a corporate tax return and pay any tax due within 9 months of the end of the relevant tax period. The tax period usually aligns with the company's financial year.
The return must include net income, deductible expenses, exempt items and transfer pricing information. Audited financial statements may be required for businesses above certain thresholds.
The calculated tax is paid via EmaraTax within the same deadline. Late payments attract penalties and interest.
Administrative penalties apply for late registration, late filing and late payment. Penalties may be fixed amounts for registration delays and cumulative (increasing monthly) for payment delays. Always follow the FTA's official announcements for current penalty amounts.
Important Notice: The rates, amounts and regulatory details on this page were compiled for July 2026 and may change over time. Because tax rates, thresholds and penalty amounts can be updated by official regulations, we recommend verifying the most current information on the official websites of the Federal Tax Authority (tax.gov.ae) and the UAE Ministry of Finance (mof.gov.ae) before making decisions.
Get expert support for corporate tax registration, filing and accounting in Dubai.
Get a Free QuoteThe United Arab Emirates continues to attract global investors with its low tax burden and strong financial infrastructure. Yet since corporate tax took effect on 1 June 2023, every business owner in Dubai must clearly understand the rates, exemptions and filing obligations. This guide brings together all the key topics — from the standard 9% rate to free zone advantages and Small Business Relief — using current official data.
The standard corporate tax rate is 9%. Taxable profit up to AED 375,000 is taxed at 0%, and the portion above this threshold is taxed at 9%. Large multinational groups with global consolidated revenue above EUR 750 million may be subject to a 15% minimum effective rate (DMTT).
Corporate tax came into effect across the UAE on 1 June 2023 and applies to all seven emirates, including Dubai.
A free zone company that meets the Qualifying Free Zone Person (QFZP) conditions can benefit from a 0% rate on its qualifying income. Non-qualifying income is subject to the standard 9% rate.
Businesses whose revenue does not exceed AED 3,000,000 in the current and all previous tax periods can elect Small Business Relief for each period. Following the UAE's extension of the initiative, the relief applies to tax periods ending on or before 31 December 2029.
The return is filed via the FTA's EmaraTax platform within 9 months of the end of the relevant tax period, and any tax due is paid within the same deadline.
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