Middle East · Tax guide

United Arab Emirates

The United Arab Emirates taxes business profits at 9% above a 0% band, with special regimes for free zones and small businesses, charges VAT at 5%, and is moving every business to e-invoicing from 1 January 2027. There is no withholding tax on payments abroad. Federal taxes are administered by the Federal Tax Authority (FTA).

Updated 1 October 2026 · 32 of 33 figures checked against official sources

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At a glance

Corporate Tax
9%

0% on the first AED 375,000 of taxable income

Qualifying free zone income
0%

For Qualifying Free Zone Persons

VAT
5%

Registration above AED 375,000 a year

Withholding tax
0%

On payments to non-residents

Small Business Relief
AED 3 million

Revenue ceiling, for periods ending by 31 December 2029

E-invoicing
1 January 2027

Mandatory start for the largest businesses

Corporate Tax

UAE Corporate Tax applies to companies and to individuals whose business turnover exceeds AED 1,000,000 a year. Taxable income up to AED 375,000 is taxed at 0%; income above it at 9%. The return is filed and the tax paid within 9 months of the end of the tax period.

Every taxable person must register, including free zone companies and those expecting to pay nothing. Late registration carries a penalty of AED 10,000.

  • Small Business Relief: resident businesses with revenue of AED 3,000,000 or less in the current and every earlier period can elect to be treated as having no taxable income, for tax periods ending by 31 December 2029.
  • Qualifying Free Zone Persons pay 0% on qualifying income if they keep adequate substance, meet the de minimis rules and prepare audited accounts; other income is taxed at 9%.
  • Large multinational groups are also subject to the UAE's domestic minimum top-up tax under the global minimum tax rules.

VAT

VAT is charged at 5%, with zero-rating for exports, international transport, certain education and healthcare, and the first supply of new residential property within 3 years of completion. Bare land, local passenger transport, most residential rent and some financial services are exempt.

Registration is mandatory once taxable supplies and imports exceed AED 375,000 over twelve months, and voluntary above AED 187,500. Apply within 30 days of passing the threshold; late registration costs AED 10,000. Returns are filed and paid within 28 days after the end of each period.

E-invoicing

The UAE is introducing mandatory e-invoicing through Accredited Service Providers, exchanging structured invoices between businesses and reporting them to the FTA. Businesses could join voluntarily from 1 July 2026.

  • Revenue of AED 50 million or more: appoint a provider by 30 October 2026 and go live on 1 January 2027.
  • All other businesses: appoint a provider by 31 March 2027 and go live on 1 July 2027.

Payments abroad and transfer pricing

The UAE withholding tax rate on payments to non-residents is 0%, so dividends, interest and royalties can be paid abroad without deduction.

Transactions with related parties and connected persons must be at arm's length. A transfer pricing disclosure form is filed with the return when related-party transactions exceed AED 40 million in total. A master file and local file are required with UAE revenue of AED 200 million or more, or group revenue of AED 3.15 billion or more.

Excise tax

Producers, importers and stockholders of excise goods register for excise tax. Tobacco products are taxed at 100%, energy drinks at 100%, and electronic smoking devices and liquids at 100%.

Since 1 January 2026, sweetened drinks are taxed per litre by sugar content: AED 1.09 per litre at 8 g of sugar per 100 ml or more, AED 0.79 per litre between 5 g and 8 g, and nothing below 5 g.

Property

There is no federal property transfer tax, but each emirate charges registration fees; in Dubai the Land Department fee is 4% of the price. Commercial property sales and rents carry VAT at 5%.

Key dates

  • Monthly or quarterlyVAT return and payment, within 28 days after the period ends
  • Each tax periodCorporate Tax return and payment, within 9 months of the period end
  • 30 October 2026Largest businesses appoint an e-invoicing Accredited Service Provider
  • 1 January 2027Mandatory e-invoicing begins for the largest businesses
  • 31 March 2027All other businesses appoint an Accredited Service Provider
  • 1 July 2027Mandatory e-invoicing begins for all other businesses

Figures and sources

33 figures

Indicative only. This assessment is a high-level overview based on the information you provided and current UAE federal tax rules. It is not tax or legal advice. Consult a qualified UAE tax advisor before making compliance decisions.