What is Corporate tax (CT)?
Corporate tax is a form of direct tax levied on the net income or profit of corporations and other entities from their business.
Applicability
(a) Individuals who are engaged in a business or business activity in UAE through an unincorporated partnership or sole proprietorship;
(b) Juridical persons incorporated in the UAE;
(c) Juridical persons effectively managed and controlled in the UAE; and
(d) Foreign juridical persons that have a permanent establishment in the UAE.
Corporate Tax Rate
- 0 per cent for taxable income up to AED 375,000
- 9 per cent for taxable income above AED 375,000
Exemptions from Corporate Tax
- Businesses engaged in the extraction of natural resources
- Dividends and capital gains earned by a UAE business from its qualifying shareholdings
- Qualifying intra-group transactions and reorganizations
Additionally, CT will not apply to:
- an individual earnings salary and other employment income
- interest and other income earned by an individual from bank deposits or saving schemes
- a foreign investor’s income earned from dividends, capital gains, interest, royalties and other investment returns
- investment in real estate by individuals in their personal capacity
- dividends, capital gains and other income earned by individuals from owning shares or other securities in their personal capacity.
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