The Federal UAE CT Law was signed on October 2022 and published on December 2022 and the CT regime became effective for financial years (FY) starting on or after 1 June 2023.

CT applies to juridical persons incorporated in the UAE (including Free Zones) and juridical persons effectively managed and controlled in the UAE, as well as to foreign juridical persons that have a permanent establishment in the UAE. Individuals will be subject to CT only if they are engaged in a business or business activity in the UAE, either directly or through an unincorporated partnership or sole proprietorship.

CT RATES
0%
– Taxable income not exceeding AED 375,000
– Qualifying income of a Qualifying Free Zone Person (QFZP)

9%
– Taxable income exceeding AED 375,000
– Non-qualifying income of a QFZP.

CT FILING AND PAYMENT
CT return filing and payment are due 9 months after the end of the FY – see examples:
– Companies that adopts a FY starting on 1 June 2023 and ending 31 May 2024 is subject to CT starting 1 June 2023 and the first return filing and payment were due on 31 December 2024
– Companies that adopts a FY starting 1 January 2023 and ending 31 December 2023 is subject to CT starting 1 January 2024 and the first return and payment are due on 30 September 2025

There are no preliminary/advance filings or tax payments.

CT REGISTRATION
Just to remind you that UAE companies must apply to register for CT within three months from the date of incorporation. An administrative penalty of AED 10,000 shall be imposed in case of failure to submit a CT registration application within the timeframe.

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