Corporate Tax in the UAE is a federal tax on business profits, applicable from financial years starting on or after 1 June 2023. Here’s the basic breakdown: 

• 9% tax on net profits exceeding AED 375,000 

• 0% tax for Free Zone companies that qualify as QFZPs (Qualifying Free Zone Persons) 

• Exemptions apply to certain government bodies, public benefit entities, and natural resource businesses 

• Reliefs are available, including Small Business Relief and Group Relief 

Even businesses in Dubai that are exempt or operating under a Free Zone license must register with the Federal Tax Authority (FTA) for compliance. The evolving legal landscape around corporate taxes for Dubai businesses makes early registration and advisory essential for long-term eligibility and relief planning.  

Managing corporate tax for Dubai businesses requires more than filing a return. It demands tailored, year-round support that accounts for licensing, revenue streams, and compliance rules: 

• FTA registration & TRN issuance 

• Annual Corporate Tax Return filing (within nine months of year-end) 

• Preparation of IFRS-compliant financials (especially for Free Zone eligibility) 

• Advisory on Free Zone status & De Minimis thresholds 

• Transfer Pricing documentation for groups over AED 50M or with related-party transactions 

• Audit support for Free Zone requirements (e.g., DMCC, DAFZA, JAFZA) 

• VAT–Corporate Tax reconciliation, to preempt discrepancies and audit triggers 

• Ongoing monitoring of Small Business Relief, Group Relief, and QFZP eligibility 

Providers familiar with corporate tax for Dubai businesses are better equipped to keep you compliant across all zones and structures.  

If there’s one thing we’ve seen repeatedly, it’s how easily founders misread Free Zone advantages or mainland exposures. Here are the biggest mistakes: 

• Only QFZPs enjoy 0% tax, and only on qualifying income. Missing income or activity criteria leads to a full 9% taxation. 

• De Minimis trap: Earning more than 5% (or AED 5M) in non-qualifying income results in losing QFZP status. 

For example, A DMCC e-commerce company earns AED 2.4M, with AED 300K (12.5%) from mainland UAE. This seemingly small portion exceeds the De Minimis limit, causing the company to lose its 0% eligibility and face full corporate tax for Dubai operations. 

• Late registration results in penalties unless covered by a temporary FTA waiver. 

• Inadequate bookkeeping or mismatched filings can trigger audits and disqualify tax reliefs. 

• Inconsistent VAT–CT data draws scrutiny and possible penalties. 

• Passive monitoring of Small Business Relief or QFZP status often results in disqualification. 

Understanding these nuances is critical to navigating corporate tax for Dubai businesses without surprises. 

Even though corporate tax is federal, Dubai’s business structures introduce additional complexity. Here’s what sets it apart: 

1. Free Zone Status: 0% tax isn’t automatic; QFZP eligibility depends on your income type, substance, and activities. 

2. Dual Licensing: Holding a mainland DED license can trigger a 9% tax unless revenue is carefully segregated. 

3. Transfer Pricing: Groups with AED 50M+ revenue or related-party deals must follow strict documentation rules. 

4. Audit Requirements: Many Free Zones (DMCC, DAFZA, JAFZA) require audited financials for 0% eligibility. 

5. VAT–CT Reconciliation: Inconsistent filings across VAT and CT raise red flags and risk audits. 

6. Relief Monitoring: Small Business Relief and De Minimis thresholds require ongoing tracking, not year-end fixes. 

7. Tailored Advisory Needed: A one-size-fits-all tax approach doesn’t work in Dubai’s layered setup. 

When it comes to corporate taxes for Dubai businesses, one-size-fits-all tax strategies usually backfire. Each business must be assessed for exposure, revenue composition, and future expansion plans, especially if you're scaling across emirates or into global markets.   

At Kitaab, we offer an end-to-end tax compliance service that goes beyond registration: 

• Fast CT registration and seamless onboarding 

• Guidance on Free Zone status, De Minimis, and transfer pricing 

• Audit-ready bookkeeping and VAT integration 

• Support for DIFC, SPVs, and complex entity structures 

• Transparent pricing with no surprise costs 

Whether you're a solopreneur in Business Bay or managing a group structure from DIFC, corporate taxes for Dubai businesses require continuous monitoring, tailored bookkeeping, and the right systems in place, all of which we help you build from day one. You focus on growth. We handle the tax side.