Corporate Tax Registration
Introducing IncHub’s Corporate Tax Registration Services in Dubai. Seamlessly navigate tax compliance with our expert guidance. Optimize your tax strategy for business success. Let us handle the complexities while you focus on growing your enterprise. Trust IncHub for efficient and reliable corporate tax solutions in Dubai. Corporate tax is a levy imposed on the profits earned by companies or corporations. It is a direct tax charged by the government on the income generated by businesses from their operations, investments, and other activities.
When is CT Applied in UAE?
corporate tax registration which has been introduced in the United Arab Emirates. This was effective from the 1st of June 2023
How to Calculate CT?
Corporate tax can be calculated from your Taxable income after adjustment have been made to your financial accounting profit and loss
Eligibility Criteria to Register
AED 1,000.000 turnover/sales for the year
Tax Bracket
Taxable income up to 375,000 is taxable at 0%. Taxable income above 375,000 is taxable at 9% this simply means if your taxable income in an FY is 600,000the first 375,000 is not taxable the excess of 225,000 is taxed at 9%.
What is Small Business Relief?
Small Business Relief is provided to small business residents for corporate tax purposes in the UAE to ease their implementation of the Corporate Tax regime.
Till when this relief is applicable?
After the registration for corporate tax there is a provision for small business relief from payingcorporate tax up to the period of 2026 which can be utilized by business.
Who is Eligible ?
In order to be able to elect for Small Business Relief, a Person must be a Resident Person for Corporate Tax purposes and have Revenueof less than or equal to AED 3,000,000 in the relevant Tax Period and any previous Tax Periods. There are no additional requirements. The only exception is that membersof MNEs and Qualifying Free Zone Persons are not eligible for Small Business relief.
Implication of Small Business Relief
losses incurred in the business cannot be carried forward and net interest expense are not deductible in the year when an election for small business relief is utilized, This also means that Businesses will not be able to accrueNet Interest Expenditure that can be carried forward to later years or use Interest expenditure from previous years.
Which entitiescan get benefitof this relief?
Any eligible Taxable Person (being a Resident Taxable Person – either a Natural Person or a Juridical Person) with Revenue below or equal to AED 3,000,0001 in a relevant Tax Periodand all previous Tax Periodsthat end on or before31 December 2026 can elect to be treated as having no Taxable Incomein that period,and will not be obliged to calculate its Taxable Income or complete a full Tax Return
An Overall Understanding
Juridical Persons
Juridical Persons
UAE CorporateTax applies to juridical persons incorporated in the UAE and to foreign juridical persons that are effectively managed and controlled in the UAE
Natural Persons
Natural Persons
Natural persons will be subject to Corporate Tax only if they are engaged in a Business or Business Activity in the UAE, either directly or through an Unincorporated Partnership or sole proprietorship.
Foreign Juridical Person
Foreign Juridical Person
A foreignjuridical person that operates in the UAE through a Permanent Establishment or that has a taxable nexus in the UAE would also be subject to Corporate Tax
Exempt Person
Exempt Person
The term "exempt person" typically refers to an individual or entity that is not subject to corporate tax regime
Who Are Exempted?
- The UAE Federal and Emirate Governments and their departments, authorities and other public institutionsÂ
- Companies wholly owned and controlled by a Government Entity that carry out a Mandated Activity, and that are listed in a Cabinet DecisionÂ
- Businesses engaged in the extraction of UAE Natural Resources or related non- extractive activities that are subject to Emirate-level taxation, subject to meetingcertain conditions; andÂ
- Qualifying PublicBenefit Entities that are listedin Cabinet DecisionNo. 37 of 2023 or any subsequent relevant decisions
Further Exempted..
- Qualifying Investment Funds that meet the prescribed conditions;
- Public or private pension or social security funds that meet the conditions specified in Ministerial Decision No. 115 of 2023; andÂ
- UAE juridical persons that are wholly owned and controlled by certain exempted entities and undertaking activities specified in paragraph (h) of Clause 1 of Article 4 of the Corporate Tax Law.
