UAE corporate tax: All you need to know

UAE corporate tax: All you need to know

The UAE government issued on Friday a new decree for the implementation of the country’s corporate tax law which will take effect next year.

Under the new tax regime, corporations and other businesses with taxable profits exceeding AED 375,000 ($102,000) will be mandated to pay a standard rate of 9% on or after June 2022.

According to the Ministry of Finance, the corporate tax will help the UAE achieve its development and transformation ambitions. The rate is said to be the lowest in the Gulf Cooperation Council (GCC) region.

Here is all you need to know about the new corporate tax:

Who will pay the corporate tax?

Businesses that earn taxable net profit of more than AED 375,000 will be required to pay corporate tax. These include UAE companies that are incorporated or managed and controlled in the UAE, as well as some entities in a free zone.

Exemptions

Individuals who are employed in the government, semi-government or private sector will not be required to pay the corporate tax. Earnings made from bank deposits or savings schemes, as well as real estate investments made by individuals, will not be subject to the new tax.

Public or private pension and social security funds, qualifying investment funds, as well as