Taxation of Corporations and Businesses

The Federal Decree-Law No. 47 of 2022 on the Taxation of Corporations and Businesses (also called the “Corporate Tax Law”) was issued by the UAE on the 9th of December 2022.?

This law provides the legislative basis for the introduction and implementation of a Federal Corporate Tax (“Corporate Tax”) in the UAE and is effective for financial years starting on or after the 1st of June 2023.??

Corporate Tax is a form of direct tax levied on the net income of corporations and other businesses.?

CT shall be imposed on Taxable Income, at the rates determined under this Decree-Law, and payable to the Authority under this Decree-Law and the Tax Procedures Law.?

1. Corporate Tax shall be imposed on the Taxable Income at the following rates:?

a. 0% (zero percent) on the portion of the Taxable Income not exceeding the amount specified in a decision issued by the Cabinet at the suggestion of the Minister.?

b. 9% (nine percent) on Taxable Income that exceeds the amount specified in a decision issued by the Cabinet at the suggestion of the Minister.?

2. Corporate Tax shall be imposed on a Qualifying Free Zone Person at the following rates:?

a. 0% (zero percent) on Qualifying Income.?

b. 9% (nine percent) on Taxable Income that is not Qualifying Income under Article 18 of this Decree-Law and any decision issued by the Cabinet at the suggestion of the Minister in respect thereof.