The long-awaited Corporate Tax law has been released by the Ministry of Finance vide Federal Decree-Law No. (47) of 2022 on the Taxation of Corporations and Businesses. It is now confirmed that the relevant businesses will become subject to UAE Corporate Tax from the beginning of their first financial year, which starts on or after 01 June 2023.
The UAE’s Corporate Tax regime will levy a standard rate of 9 percent for taxable profits exceeding AED 375,000. Profits lower than that amount will be taxed at a 0 percent rate to support small businesses and start-ups.
With respect to UAE free zone onshore companies, which are resident in UAE, and their operations do not fall under the tax exempt entities, they will be taxed at 9% on their net profit if it exceeds AED 375000 per annum with the exemption of dividend received and capital gains which are tax exempt if the following conditions are met