Doing business in the UAE: taxes foreign companies and founders need to know
No personal income tax, 9% corporate tax above AED 375,000, Small Business Relief to 2029 and 5% VAT: the UAE tax picture for founders from abroad.
The UAE remains one of the most tax-efficient places to run a company, but it is no longer tax-free for businesses. Here is what foreign founders and companies need to know.
For individuals
There is no personal income tax on salaries in the UAE. Your home country may still tax you depending on your residence and its rules, so check before you move.
Corporate tax
- 0% on taxable profit up to AED 375,000
- 9% on taxable profit above AED 375,000
- Small Business Relief for revenue up to AED 3 million, extended to tax periods ending on or before 31 December 2029
- Qualifying free zone persons can access 0% on qualifying income if they meet the conditions
- Most companies must register for corporate tax, even if they pay nothing
VAT
- Standard rate of 5%
- Mandatory registration when taxable supplies exceed AED 375,000 a year
- Voluntary registration from AED 187,500
Foreign companies
A foreign company can become taxable in the UAE if it has a permanent establishment here, such as a fixed place of business or staff who conclude contracts on its behalf. Take advice before placing people in the UAE for a foreign entity.
Common questions
Is Dubai tax-free for businesses?
No longer completely. Companies pay 9% corporate tax on profit above AED 375,000, but small businesses can use Small Business Relief until 2029 and individuals pay no income tax on salaries.
Do I need to register for corporate tax if I make no profit?
In most cases, yes. Registration is required for most companies regardless of profit.
Rules, fees and processes change. Confirm the details with the relevant authority or a licensed adviser before you commit.
