UAE CT Rate

UAE CT Rate

UAE CT Rate : As per Ministry of Finance, CT rates are : 0 per cent for taxable income up to AED 375,000. 9 per cent for taxable income above AED 375,000 and a different tax rate (not yet specified) for large multinationals that meet specific criteria set with reference to ‘Pillar two’ of the OECD Base Erosion and Profit Shifting Project.

UAE CT Rate:

  • 0% for taxable income up to AED 375,000;
  • 9% for taxable income above AED 375,000
UAE CT  Summary

The Ministry of Finance (MOF) of the United Arab Emirates (UAE) announced on 31 January 2022 that the UAE will introduce federal corporate tax (CT) starting on or after 1 June 2023.

According to the UAE Ministry of Finance, this announcement follows its confirmation in July 2021 that the UAE will support the global minimum effective tax rate under the organisation for economic co-operation and development (OECD)/G20 Base Erosion and Profit Shifting (BEPS) 2.0 project in accordance with the OECD/G20 guidelines.

While the CT law has not yet been issued, the MOF has published a frequently asked questions that describes key elements of CT policy and design

UAE CT  Rate and Timing

The UAE CT rates are 0% for taxable income up to AED375,000; 9% for taxable income above AED375,000. 

CT will be effective for financial years starting on or after 1 June 2023.  Businesses with an accounting reference date of 31 December will become subject to CT from 1 January 2024.

Tax Base

Tax base: CT will be payable on the profits reported in the financial statements of UAE businesses in accordance with internationally accepted accounting standards, with only minor exceptions.

Losses incurred by entities subject to CT may be carried forward for offset against future taxable income if certain conditions are met. Under certain conditions, tax losses may also be applied to taxable income of another group company.

Corporate Tax in the UAE

Corporate tax (CT) is a form of direct tax levied on the net income or profit of corporations and other entities from their business. Corporate Tax is sometimes also referred to as “Corporate Income Tax (CIT)” or “Business Profits Tax” in other jurisdictions.

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