Corporate Tax

What is Corporate Tax in the UAE?

Corporate tax is a direct tax levied on the net profits of businesses. Under the new regulations:

• Net profit up to AED 375,000 is tax-free.
• 9% tax applies on profits exceeding AED 375,000.
• Multinational corporations with specific criteria are subject to different tax rates in line with international guidelines like the OECD’s Base Erosion and Profit Shifting (BEPS) framework.

The introduction of corporate tax is a major shift from the UAE’s long-standing tax-free environment for businesses. However, with one of the lowest corporate tax rates globally, the UAE still maintains its competitiveness as a top business hub. For comparison, countries like France, the USA, and India impose significantly higher tax rates, making the UAE an attractive location for global investments.

Why Choose AH Management Consultancy for Corporate Tax Services?

At AH Management Consultancy, we offer expert assistance to ensure your business complies with the UAE’s corporate tax laws while optimizing your tax liabilities. Here’s why we are the right choice for your corporate tax needs:

Expert Knowledge of UAE Tax Law

Our team of tax consultants is well-versed in the details of the UAE’s corporate tax system. From understanding how the new tax regime applies to your business to providing strategies for minimizing tax liabilities, we ensure you meet all compliance requirements while maximizing your financial efficiency.

Tailored Tax Solutions for Businesses of All Sizes

Whether you’re operating in a free zone, managing a multinational corporation, or handling operations in various Emirates, we provide customized solutions that fit your business structure. We understand the nuances of the UAE’s tax system and will help your business navigate it with ease.

Corporate Tax Optimization

Our services include tax planning and optimization strategies designed to minimize your taxable income legally. We will work closely with your finance team to ensure that all available deductions, exemptions, and benefits are used to their fullest extent.

Assistance with Free Zone Regulations

If your business operates in a UAE free zone, you can benefit from favorable tax rates. We’ll help ensure that you qualify as a Qualifying Free Zone Person (QFZP) and assist with compliance, ensuring you can enjoy 0% tax on qualifying income while staying fully compliant with the UAE’s corporate tax laws.

Ongoing Compliance and Reporting

Corporate tax compliance doesn’t end with filing taxes. We provide continuous support to ensure your business adheres to the tax regulations, prepares accurate tax returns, and remains up-to-date with any changes to tax laws. Our team will handle the detailed reporting and documentation required by the UAE Federal Tax Authority (FTA).

Who is Affected by Corporate Tax in the UAE?

The UAE Corporate Tax applies to:

• All businesses conducting activities under a commercial license in the UAE.
• Free zone businesses, provided they adhere to legal requirements and do not operate on the UAE mainland.
• Foreign entities that conduct trade or business within the UAE on a regular basis.
• Banking operations, and businesses involved in real estate management, construction, and related services.

However, some exemptions apply, including:

• Natural resource extraction businesses (subject to Emirate-level taxation).
• Dividends and capital gains earned from qualifying shareholdings.
• Intra-group transactions that meet the necessary conditions.
• Personal income such as salaries, wages, and individual earnings that are not part of a commercial activity.

Key Benefits of Corporate Tax in the UAE

The introduction of corporate tax in the UAE brings several significant advantages:

Strengthened Economy

The corporate tax regime plays a vital role in diversifying the UAE’s economy, ensuring long-term sustainability, and helping the country meet international tax standards.

Attracting Global Investments

Despite the tax introduction, the UAE remains one of the most attractive destinations for foreign investment due to its competitive tax rates, strategic location, and business-friendly policies.

Increased Tax Transparency

The corporate tax regime ensures that businesses operate transparently, contributing to a fairer and more competitive environment for all players in the market.

How AH Management Consultancy Can Assist Your Business

At AH Management Consultancy, we offer a full range of corporate tax services to ensure that your business remains compliant with the latest tax regulations in the UAE:

• Tax Advisory: We offer expert guidance on how corporate tax applies to your business, helping you structure your operations to maximize tax efficiency.
• Tax Filing and Reporting: We handle all aspects of tax filing, ensuring timely and accurate submission of tax returns, reducing the risk of penalties.
• Tax Optimization: Through detailed planning, we’ll help you minimize your tax burden by taking full advantage of exemptions and deductions available under the UAE tax laws.
• Support for Free Zone Businesses: If your business is based in a free zone, we provide specialized assistance to ensure you benefit from the tax incentives while remaining compliant with local regulations.

Conclusion

The UAE’s corporate tax law presents new opportunities and challenges for businesses. At AH Management Consultancy, we are committed to helping you navigate these changes with expert advice and customized solutions. Whether you’re a new startup, an established