Corporate Tax Support in the UAE: Crucial for Businesses in the United Arab Emirates

The introduction of the federal corporate tax (CT) regime in the UAE in 2023 has reshaped the country's business environment, aligning it with global tax standards and ensuring long-term economic growth. This direct tax overhaul, governed by UAE corporate tax law, requires UAE businesses to adhere to new tax regulations, file tax returns, and implement compliance strategies. Navigating the complexities of the UAE CT regime can be overwhelming for businesses in the UAE, which is where corporate tax support becomes indispensable. In this blog, we’ll explore the essence of corporate tax support in the UAE, available government-backed resources from the Federal Tax Authority (FTA) and Ministry of Finance (MOF), and private sector services in Dubai and Abu Dhabi that assist businesses in adhering to corporate tax rules and tax management.

What is Corporate Tax Support in the UAE?

Corporate tax support in the UAE refers to the resources, programs, and professional services designed to help businesses meet the challenges of tax registration, compliance, filing, and optimization. With the first full filing cycle taking place in 2025, businesses are increasingly seeking tax advisory and services in the UAE to handle the complexities of the new UAE CT regime. Support can be categorized into government-provided and private-sector services.

History of Corporate Tax in the UAE

The UAE’s journey to introduce corporate tax in the UAE began with Federal Decree-Law No. 47 of 2022, which was implemented on June 1, 2023. Prior to this, the UAE was known for its tax-free environment, making it one of the most attractive destinations for business in the UAE globally. The shift to a corporate income tax regime was motivated by the desire to diversify the UAE economy, combat harmful tax practices, and align with international standards, such as the OECD’s base erosion and profit shifting (BEPS) guidelines, promoting tax transparency.

The UAE corporate tax primarily applies to businesses and other juridical persons operating within the UAE, targeting net income or profit. It maintains the UAE’s appeal by offering exemptions for certain sectors, such as government entities and extraction of natural resources like oil and gas. The introduction of this tax marks the UAE’s shift toward a more balanced and fair tax system, which impacts UAE businesses of all sizes, from SMEs to large multinational corporations, including free zone companies.

Key Features of the UAE Business Corporate Tax

The UAE CT regime is designed to be progressive yet straightforward, with tax rates and thresholds tailored to various business sizes. The main features include:

→ Tax Rates and Thresholds

• A 0% tax rate on taxable income up to AED 375,000 (approximately USD 102,000), providing relief to smaller businesses and ensuring no significant tax burden on low UAE taxable income.
• A 9% tax rate for taxable income above AED 375,000, which is the standard rate for most businesses under corporate tax rules.

For instance, a business with AED 500,000 in net income or profit will pay AED 11,250 in tax on the amount exceeding AED 375,000, resulting in a blended tax rate of approximately 2.25%. This structure supports tax planning and deduction strategies for optimal corporate tax management.

→ Small Business Relief

Businesses with revenue under AED 3 million and not part of a multinational group can opt for a 0% tax rate on income up to AED 3 million for up to three years, provided they meet certain conditions, offering complete corporate tax relief for emerging UAE businesses.

→ Free Zone Incentives

Qualifying Free Zone Persons (QFZPs) in designated UAE free zones (e.g., Dubai International Financial Centre) can benefit from a 0% tax rate on qualifying income. Non-qualifying income is taxed at 9%, with UAE free zone companies needing to ensure substance at the place of business to qualify.

→ Domestic Minimum Top-up Tax (DMTT)

Starting January 1, 2025, large multinational companies (with global revenue ≥ €750 million) will face a 15% minimum tax on UAE profits, ensuring compliance with OECD Pillar Two rules and addressing minimum tax requirements to prevent harmful tax practices.

Who Needs Corporate Tax Support?

While the corporate tax in the UAE applies to a wide range of businesses, understanding its nuances and adhering to its requirements can be a complex process. Expert corporate tax support is crucial for:

• Tax Residents: UAE-incorporated entities or those managed and controlled in the UAE.
• Non-Residents: Businesses with UAE-sourced income, including from permanent establishments or immovable property at a place of business.
• Exemptions: Certain entities, such as governments, charitable organizations, and pension funds, as well as family foundations (based on FTA guides), are exempt from corporate income tax.

Even businesses with no taxable income, such as startups operating at a loss, must still register and file nil returns to stay compliant with tax regulations. This is especially relevant when considering corporate tax and VAT interactions, as value added tax (VAT) remains a separate obligation.

Corporate Tax Registration and Filing Process Explained

For businesses to comply with UAE’s corporate tax laws, they must register and handle tax return filing as per the following process:

🔹Registration:

All businesses must register within three months of becoming taxable or by March 31, 2024, for businesses already in operation. The registration process is completed via the FTA’s EmaraTax portal or Tas'heel Centers and requires various documents, including the Trade License and Memorandum of Association.

🔹Filing:

Annual returns must be filed within nine months after the end of the business's financial year. The first filings for the 2023 financial year were due in 2024, with subsequent returns expected to be more challenging due to international tax disclosures and transfer pricing documentation.

🔹Payments:

Businesses must make provisional payments in installments, with a final adjustment at the time of filing. Penalties for late filing can amount to AED 10,000 plus 1% monthly interest.

🔹Record-Keeping:

Businesses are required to maintain tax-related records for a minimum of seven years. This includes documentation for transfer pricing, which requires that related-party transactions adhere to arm’s-length pricing, supporting tax strategies and tax transparency.

Government-Provided Corporate Tax Support

The UAE government, through the Federal Tax Authority and Ministry of Finance (MOF), offers a range of support services to ensure businesses comply with the new corporate tax regime:

1. UAE Tax Agent Programme (Launched October 2025):

This initiative aims to train and certify 500 Emirati tax agents who can assist businesses with tax filings, audits, and tax management. The program offers free training in both Arabic and English, with certification allowing agents to represent clients before the FTA.

2. Tas'heel Centers:

These one-stop government service centers help businesses with registration, return filing, and tax-related queries. Services are available across the UAE, including in Dubai and Abu Dhabi, and businesses can access them for a nominal fee or for free.

3. FTA Guides and Public Clarifications:

The FTA provides over 20 free guides on tax.gov.ae, covering topics such as Small Business Relief, Family Foundations, and Corporate Tax Returns. These guides offer step-by-step instructions for compliance and address common queries related to corporate tax rules and VAT.

4. Helpline and Software Vendors:

The FTA’s 600-599-999 helpline is available for businesses needing assistance. Additionally, businesses can access a list of accredited tax accounting software vendors that integrate with EmaraTax for filing automation, aiding in corporate tax and VAT management.

Private-Sector Corporate Tax Support Services

In addition to government-provided services, businesses can also seek professional assistance from tax consultants and advisory firms. These private-sector services in Dubai and services in the UAE are particularly useful for businesses dealing with complex tax matters, such as transfer pricing or free zone structuring.

1. Multinational Firms:

Major firms offer end-to-end corporate tax services, including registration, annual filing, and advisory services. These firms are particularly suited for large corporations and multinationals, with fees ranging from AED 10,000 to over AED 100,000 depending on the scope of services, focusing on tax planning and deduction optimization.

2. Local Tax Firms:

For SMEs and startups, local firms such as CLA Emirates, Alpha Pro Partners, and TaxReady provide affordable corporate tax compliance packages. These services help businesses avoid penalties and optimize tax obligations, with costs typically ranging from AED 2,000 to AED 10,000, including support for net income or profit calculations.

3. Certified Tax Agents:

Certified tax agents, trained through the UAE Tax Agent Programme, assist small businesses with annual filing for a fee of AED 1,000-5,000 per year, ensuring complete corporate tax handling.

Challenges and Best Practices for Corporate Tax Support

As businesses transition to the new tax regime, several challenges have emerged. Early filings for 2025 revealed issues with incomplete transfer pricing documentation and substance misclassifications, leading to audits and penalties. To avoid these issues, businesses should adopt the following best practices:

1. Engage Corporate Tax Support Early:

   It’s important to seek professional help well in advance of registration and filing deadlines to ensure compliance and optimize tax reporting, especially for UAE taxable entities.

2. Utilize FTA's EmaraTax Portal:

   For businesses with straightforward tax affairs, the EmaraTax portal allows for self-service registration and filing, making it a convenient and cost-effective solution for tax return filing.

3. Monitor FTA Updates:

   The FTA frequently releases newsletters and clarifications, which businesses should monitor to stay up-to-date with the latest regulatory changes, including those on minimum tax and value added tax.

4. Free Zone Considerations:

   Businesses in free zones must ensure that they meet the substance requirements to benefit from tax exemptions, such as having adequate employees and physical assets, aligning with UAE free zone incentives.

How Young & Right can Help you with Expert Corporate Tax Support

In the UAE's evolving tax landscape, business corporate tax presents both opportunities and complexities for entities looking to conduct a trade or business in this investor-friendly hub. Young & Right stands as your trusted partner, offering expert guidance to minimize tax paid while maximizing benefits under the federal framework. Whether you're establishing in Dubai's dynamic free zones or optimizing mainland operations, our comprehensive services ensure compliance, strategic structuring, and growth, all rooted in the UAE's based principles of economic diversification and FDI attraction—where over 50 free zones drive 40% of investments without eroding their appeal.

1. Navigating Qualifying Free Zone Person (QFZP) Status

Young & Right specializes in guiding businesses that conduct a trade or business within UAE's dynamic free zones, such as Jebel Ali or DMCC, to achieve and maintain QFZP status under the federal corporate tax framework. As UAE is based on investor-friendly policies, our expert professional tax advice ensures your entity qualifies for tailored perks. We help over 50 free zones' enterprises—from media in Dubai Media City to fintech in DIFC—seamlessly integrate these requirements, turning potential hurdles into strategic advantages that attract relocations in the evolving tax landscape.

Key perks include:

• Demonstrating substance through core income-generating activities
• Maintaining employees and assets located in the zone

2. Maximizing 0% Tax on Qualifying Income

For entities enjoying 0% tax paid on qualifying income, Young & Right provides Professional Accounting Services to optimize your revenue streams. Our team leverages the UAE's economic engines to ensure your operations remain tax-free while enhancing rather than eroding the appeal of free zones, which contribute to 40% of UAE's FDI. We conduct thorough reviews to align your business activities with these benefits, safeguarding your bottom line through precise classification and reporting.

Qualifying activities eligible for 0% tax include:

• Manufacturing
• Logistics
• Intra-zone trading

3. Managing 9% Tax on Non-Qualifying Income

When mainland UAE transactions trigger the 9% rate on non-qualifying income, Young & Right's Expert Bookkeeping Services step in to encourage zone-centric commercial activities and minimize exposure. By fostering a compliant structure that prioritizes qualifying activities, we help businesses in zones like DMCC reduce their overall tax paid, allowing you to focus on growth without the burden of unexpected liabilities.

Our approach involves:

• Meticulously tracking and segregating income sources
• Ensuring only applicable portions face taxation while the rest benefits from free zone incentives

4. Ensuring Compliance with Economic Substance and Transfer Pricing

To uphold QFZP status, adherence to OECD-aligned transfer pricing and annual economic substance audits is essential, and Young & Right delivers comprehensive support through tailored compliance strategies. For businesses that conduct a trade or business across borders, our Professional Accounting Services integrate these requirements seamlessly, mitigating risks and ensuring your UAE-based operations remain audit-ready, all while amplifying the halo effect of corporate tax in free zones.

We assist in documenting substance, such as:

• Adequate employees in the zone
• Assets located in the zone

5. Specialized Services for Tax Efficiency

Young & Right empowers clients with the de minimis rule, allowing non-qualifying revenue up to 5% or AED 5 million to still qualify for 0% tax rates, paired with our Best clinical costing services for healthcare or specialized sectors in free zones. Our holistic approach includes Expert Bookkeeping Services to monitor thresholds and optimize filings, ensuring even diverse enterprises maintain eligibility without compromising on efficiency. As UAE is based on fostering innovation, we provide end-to-end guidance that not only sails through compliance but also maximizes tax savings, making corporate tax a strategic ally rather than an obstacle.

Conclusion

As the UAE’s corporate tax landscape continues to evolve, businesses must stay ahead of regulatory changes and ensure compliance with the new tax system. Corporate tax support, whether through government initiatives or private-sector consulting, plays a critical role in navigating the complexities of the UAE Corporate Tax regime. By engaging the right support at the right time, businesses can minimize compliance burdens, avoid penalties, and focus on growth and innovation in the UAE’s thriving economy.

For businesses in need of professional assistance, firms like Young & Right provide comprehensive corporate tax support, ensuring seamless compliance with UAE tax laws. Whether you are a startup, SME, or multinational corporation, expert corporate tax advice is essential to optimize your tax position and ensure sustainable success in the UAE.