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Corporate tax rates

Applies
FY2024 onwards
Reviewed
Rule
UAE-CT-RATE-2024.1
By

What is the UAE Corporate Tax rate?

0% on taxable income up to AED 375,000 and 9% above it. A Qualifying Free Zone Person pays 0% on Qualifying Income.

Per Federal Decree-Law No. 47 of 2022, Article 3, Corporate Tax Rate

Corporate Tax is imposed on Taxable Income at a lower rate on the portion not exceeding an amount the Cabinet specifies, and at the standard rate on the portion that exceeds it. For a Qualifying Free Zone Person, Corporate Tax is imposed at the lower rate on Qualifying Income and at the standard rate on Taxable Income that is not Qualifying Income.

The rate applied to the figure the taxable income stage produces. What this rule gives is the Corporate Tax on the Taxable Income — not the amount remaining to be settled, which Article 44 reaches only after the Withholding Tax Credit, the Foreign Tax Credit and any credit the Cabinet specifies have been applied in that order.

Two schedules

Both use the same two rates. They do not use them the same way.

3(1) — a Taxable Person generally: a band

  • (a) The lower rate on the portion of Taxable Income not exceeding the amount specified in a Cabinet Decision
  • (b) The standard rate on Taxable Income that exceeds that amount

3(2) — a Qualifying Free Zone Person: no band

  • (a) The lower rate on Qualifying Income
  • (b) The standard rate on Taxable Income that is not Qualifying Income under Article 18 and any Cabinet Decision issued in respect of it

The difference that costs money

A Qualifying Free Zone Person does not get the Article 3(1) band beneath its non-qualifying income. Applying one would understate the tax, and it is an easy mistake because the two rates are the same in both schedules.

Article 44 — the order of settlement

The Corporate Tax due is settled first by the available Withholding Tax Credit, then by the available Foreign Tax Credit, then by any credit or relief the Cabinet specifies, and only then is the residual payable under Article 48.

Order of testing

  1. 1

    Inputs requiring your determination

    Any input a person must decide and has not decided stops the computation. Only the figures the applicable schedule needs are asked for — a general Taxable Person has no Qualifying Income to report, and asking for it would suggest the band and the free-zone split can both apply.

  2. 2

    Taxable Income

    Article 3 imposes Corporate Tax on Taxable Income. Where there is none, no tax arises on it and whether the amount is a Tax Loss is decided by Articles 37 and 39.

  3. 3

    Rates for a Qualifying Free Zone Person

    Article 3(2). The lower rate on Qualifying Income and the standard rate on the rest, with no band beneath it.

  4. 4

    Rate within the band

    Where Taxable Income does not exceed the published band amount, the whole of it is at the lower rate.

  5. 5

    Rates across the band

    Where it exceeds the band amount, the portion within is at the lower rate and the excess at the standard rate.

Examples

Illustrative scenarios — ours, not the authority’s — each computed live by this rule. Change any fact and the outcome is the rule’s, not a hand-written answer.

Taxable income across the band

A mainland company with Taxable Income of AED 5,000,000 for the period.

Computed

Corporate Tax of AED 416,250 as computed for FY2026: 0% on the AED 375,000 of Taxable Income within the published band of AED 375,000 and 9% on the AED 4,625,000 above it, from Taxable Income of AED 5,000,000, based on the figures you supplied. Article 44 settles the Corporate Tax due in a fixed order — Withholding Tax Credit, then Foreign Tax Credit, then any credit or relief the Cabinet specifies — so this figure is the Corporate Tax on the Taxable Income, not the amount remaining to be settled.

Workings

Taxable Incomeas supplied
AED 5,000,000
Band amountArticle 3(1) — specified by the Cabinet, published value for FY2026
AED 375,000
Portion within the bandArticle 3(1)(a)
AED 375,000
Rate on that portionArticle 3(1)(a) — published value for FY2026
0%
Corporate Tax on the portion within the bandArticle 3(1)(a)
AED 0
Portion above the bandArticle 3(1)(b)
AED 4,625,000
Rate on that portionArticle 3(1)(b) — published value for FY2026
9%
Corporate Tax on the portion above the bandArticle 3(1)(b)
AED 416,250
Corporate Tax on Taxable IncomeArticle 3(1) — before the Article 44 settlement order
AED 416,250

Decided by the rates across the band

Taxable income wholly within the band

A small company with Taxable Income of AED 250,000, below the published band amount.

Computed

Corporate Tax of AED 0 as computed for FY2026: 0% on the AED 250,000 of Taxable Income within the published band of AED 375,000 and 9% on the AED 0 above it, from Taxable Income of AED 250,000, based on the figures you supplied. Article 44 settles the Corporate Tax due in a fixed order — Withholding Tax Credit, then Foreign Tax Credit, then any credit or relief the Cabinet specifies — so this figure is the Corporate Tax on the Taxable Income, not the amount remaining to be settled.

Workings

Taxable Incomeas supplied
AED 250,000
Band amountArticle 3(1) — specified by the Cabinet, published value for FY2026
AED 375,000
Portion within the bandArticle 3(1)(a)
AED 250,000
Rate on that portionArticle 3(1)(a) — published value for FY2026
0%
Corporate Tax on the portion within the bandArticle 3(1)(a)
AED 0
Portion above the bandArticle 3(1)(b)
AED 0
Rate on that portionArticle 3(1)(b) — published value for FY2026
9%
Corporate Tax on the portion above the bandArticle 3(1)(b)
AED 0
Corporate Tax on Taxable IncomeArticle 3(1) — before the Article 44 settlement order
AED 0

Decided by the rate within the band

A Qualifying Free Zone Person with both kinds of income

A free-zone company with AED 20,000,000 of Qualifying Income and AED 1,500,000 of Taxable Income that is not Qualifying Income. No band applies to the second figure.

Computed

Corporate Tax of AED 135,000 as computed for FY2026 under the Article 3(2) schedule: 0% on Qualifying Income of AED 20,000,000 and 9% on Taxable Income that is not Qualifying Income of AED 1,500,000. The Article 3(1) band does not apply to a Qualifying Free Zone Person, so there is no exempt portion beneath the non-qualifying amount. Based on the figures you supplied. Article 44 settles the Corporate Tax due in a fixed order — Withholding Tax Credit, then Foreign Tax Credit, then any credit or relief the Cabinet specifies — so this figure is the Corporate Tax on the Taxable Income, not the amount remaining to be settled.

Workings

Qualifying IncomeArticle 3(2)(a) — as supplied
AED 20,000,000
Rate on Qualifying IncomeArticle 3(2)(a) — published value for FY2026
0%
Corporate Tax on Qualifying IncomeArticle 3(2)(a)
AED 0
Taxable Income that is not Qualifying IncomeArticle 3(2)(b) — as supplied
AED 1,500,000
Rate on the non-qualifying amountArticle 3(2)(b) — published value for FY2026. No band applies
9%
Corporate Tax on the non-qualifying amountArticle 3(2)(b)
AED 135,000
Corporate Tax on Taxable IncomeArticle 3(2) — before the Article 44 settlement order
AED 135,000

Decided by the rates for a qualifying free zone person

A loss-making period

A company with a Taxable Income figure of negative AED 3,000,000 for the period.

Computed

No Corporate Tax arises on the Taxable Income as computed: Article 3 imposes Corporate Tax on Taxable Income, and the figure supplied is (AED 3,000,000). Whether the amount is a Tax Loss available to carry forward is decided by Articles 37 and 39.

Workings

Taxable Incomeas supplied
(AED 3,000,000)
Corporate Tax on Taxable Incomenil — no Taxable Income for a rate to apply to
AED 0

Decided by the taxable income

Try it

Supply the facts and this rule computes the outcome in your browser, live. Leave a determination undecided and it blocks the result — it is never read as a no.

Not computed yet

1 input still need your determination:

  • Is the Taxable Person a Qualifying Free Zone Person?

Computed in your browser from the figures you supply. Nothing is sent anywhere, and the result is a computation against a rule — reference, not tax advice.

Thresholds

uae.corporate_tax_lower_rate
0% · reviewed 2026-09-28 · source
uae.corporate_tax_standard_rate
9% · reviewed 2026-09-28 · source
uae.corporate_tax_band_threshold
AED 375,000 · reviewed 2026-09-28 · source

Threshold values are published separately from the rule and carried with a citation. Where none has been published for the period being computed, the rule reports that rather than applying a default.

Sources

Share this rule

Reference, not tax advice.

Pankaj Agarwal — Tax Technology Leader