Corporate Tax

Who is Subject to Corporate Tax?

Corporate tax applies to:

• UAE-based companies : Including mainland companies, free zone entities, and branches of foreign companies.
• Individuals conducting business : Sole proprietors, freelancers, and partnerships involved in business activities within the UAE.
• Free Zone Companies : Businesses operating in UAE Free Zones that do not meet specific conditions for tax exemption.

Corporate Tax Rates in the UAE

The UAE offers one of the most competitive tax regimes globally. Key tax rates include:

• 0% Tax Rate : Applicable to taxable income up to AED 375,000 to support small businesses and startups.
• 9% Tax Rate : Levied on taxable income exceeding AED 375,000.
• Qualifying Free Zone Entities : May continue to benefit from a 0% tax rate on qualifying income, subject to specific conditions.

Exemptions and Reliefs

The UAE offers various exemptions and reliefs to support businesses:

• Free Zone Exemptions : Businesses in certain Free Zones may be exempt from corporate tax, provided they comply with regulatory requirements.
• Participation Exemption : Dividends and capital gains earned from qualifying shareholdings may be exempt from corporate tax.
• Intra-Group Relief : Certain transactions between group companies may be eligible for tax relief, reducing the overall tax burden.

Corporate Tax Compliance Requirements

• Registration : Businesses must register for corporate tax with the Federal Tax Authority (FTA) and obtain a Tax Registration Number (TRN).
• Tax Returns : Businesses are required to file annual corporate tax returns, detailing income, expenses, and tax payable.
• Record Keeping : Companies must maintain accurate financial records and documents to support their tax filings for at least five years.
• Transfer Pricing : Businesses engaged in transactions with related parties must comply with UAE transfer pricing rules and maintain proper documentation.

Steps to Ensure Corporate Tax Compliance

1. Assess Your Tax Liability :
• Begin by evaluating whether your business is subject to corporate tax based on its income, structure, and location within the UAE.
2. Register for Corporate Tax :
• If applicable, register with the FTA and obtain your Tax Registration Number (TRN). GSS can assist with the registration process to ensure accuracy and timely compliance.
3. Prepare Financial Statements :
• Compile detailed financial statements, including income, expenses, and profits, to determine your taxable income.
4. File Your Corporate Tax Return :
• Submit your annual corporate tax return to the FTA, ensuring that all information is accurate and complete.
5. Implement Transfer Pricing Policies :
• If your business engages in related-party transactions, implement transfer pricing policies in line with UAE regulations and maintain necessary documentation.
6. Stay Updated on Tax Regulations :
• Regularly review updates to UAE tax laws and regulations to ensure ongoing compliance and take advantage of any available tax benefits.

Why Choose GSS for Corporate Tax Services?

• Expertise in UAE Tax Laws : With extensive knowledge of UAE corporate tax regulations, GSS ensures that your business remains compliant and avoids any potential penalties.
• Customized Tax Solutions : We offer tailored tax strategies that align with your business goals, helping you optimize your tax liability while staying compliant.
• Record Keeping :
• Comprehensive Support : From tax registration to return filing and ongoing compliance, GSS provides end-to-end corporate tax services, ensuring peace of mind for your business.