Frequently Asked Questions

The UAE corporate tax rate is 0% on taxable income up to AED 375,000 and 9% on income exceeding that threshold.

Applies as at August 2026

All businesses operating in the UAE with taxable income above AED 375,000 must register for corporate tax, except for qualifying free zone entities and exempted businesses.

Applies as at August 2026

Free zone companies may be eligible for a 0% tax rate if they meet specific requirements, such as not conducting business with the UAE mainland.

Applies as at August 2026

Yes, the UAE offers tax relief for small businesses if the revenue does not exceed AED 3 million.

Applies as at August 2026

Transfer pricing regulations apply to multinational businesses to ensure fair pricing of intercompany transactions. Companies must maintain transfer pricing documentation to comply with UAE tax laws.

Corporate tax returns must be filed annually with the UAE Federal Tax Authority. The deadline varies based on the company's financial year-end.

Applies as at August 2026

Businesses that fail to submit corporate tax filings on time may face penalties, which increase based on the duration of non-compliance.

Applies as at August 2026

Most business-related expenses, including salaries, rent, and operational costs, can be deducted if they meet the criteria set by the UAE tax authorities.

Businesses with an annual taxable turnover exceeding AED 375,000 must register for VAT. Those with revenue above AED 187,500 may register voluntarily.

Applies as at August 2026

Most businesses must file VAT returns quarterly, but some larger entities may be required to file monthly.

Applies as at August 2026

Failure to file VAT returns on time may result in penalties starting from AED 1,000, increasing for repeated offenses.

Applies as at August 2026

Businesses that incur recoverable input VAT can apply for a refund through the UAE Federal Tax Authority.

Sectors such as real estate, financial services, legal firms, and luxury goods trading are required to follow AML regulations, conduct risk assessments, and submit reports.

Applies as at August 2026

Non-compliance with AML regulations can lead to heavy fines, business license suspension, and legal action.

Applies as at August 2026

Regulated businesses must implement AML policies, conduct staff training, and perform due diligence on transactions.

Companies must keep detailed financial records, invoices, tax returns, and transaction logs in compliance with IFRS standards.

The UAE requires businesses to maintain financial records for at least five years to comply with regulatory audits.

Applies as at August 2026

Excise tax is levied on specific goods such as tobacco, energy drinks, and carbonated beverages. Businesses dealing with excisable goods must register with the UAE Federal Tax Authority.

Applies as at August 2026

Tax liability can be minimized through strategic tax planning, optimizing deductible expenses, and ensuring compliance with all available exemptions and incentives.

If selected for a tax audit, businesses should ensure all financial records are in order, comply with all documentation requests, and seek professional guidance to navigate the process smoothly.

No. A Qualifying Free Zone Person still registers, files returns, keeps IFRS financial statements and maintains transfer pricing documentation. The 0% rate applies to qualifying income only when all conditions are continuously met.

Applies as at August 2026

Broadly, income from qualifying activities and transactions with other free zone persons, subject to the de minimis limits on non-qualifying revenue. The classification should be mapped against the current Cabinet and Ministerial Decisions.

Applies as at August 2026

Failing any condition — such as adequate substance, audited financial statements, transfer pricing compliance or the de minimis test — can remove the benefit for the period and affect following periods.

Yes, but mainland-sourced income is generally non-qualifying and taxed at the standard rate, unless it falls within a qualifying category. The split needs to be tracked and documented.

Deadlines vary by notice type and are stated in the document itself. Reconsideration and objection routes have strict statutory windows, so the notice should be reviewed as soon as it arrives.

Yes. Penalty reconsiderations can address the penalty separately where there are grounds, such as procedural issues or circumstances accepted under the penalty framework.

Contemporaneous records: invoices, contracts, bank movements and the working papers behind each filing. Rebuilt evidence is weaker, which is why record quality matters before any dispute begins.

It is a formal correction mechanism under the tax procedures law. Filing one before an audit begins is generally treated more favourably than errors discovered during a review.