Corporate tax in the UAE: registration, returns and QFZP

UAE corporate tax is 0% on taxable income up to AED 375,000 and 9% above it. A free zone company that qualifies as a QFZP pays 0% on qualifying income and 9% on the rest. Every taxable person must register, including free zone companies that expect to pay 0%; late registration costs AED 10,000 unless the first return is filed within seven months of the end of the first tax period. The return and payment are due within nine months of the end of the tax period. We handle registration, computation, filing and QFZP review.

UAE corporate tax rules in brief

Rate: 0% on taxable income up to AED 375,000 and 9% above it, for tax periods starting on or after 1 June 2023 (Federal Decree-Law No. 47 of 2022, Art. 3(1); Cabinet Decision No. 116 of 2023). A free zone licence does not by itself give a 0% rate, and there is no separate offshore rate.

Registration and filing: every taxable person registers, including free zone companies that expect to pay 0%. The return, and payment of any tax due, follow within nine months of the end of the tax period, and reliefs are claimed in the return.

QFZP: a Qualifying Free Zone Person pays 0% on qualifying income and 9% on all other taxable income, with no AED 375,000 band (Art. 3(2)). Failing any condition removes the status from the start of that tax period and for the next four (Ministerial Decision No. 229 of 2025, Art. 5), and the standard 0%/9% rates apply meanwhile. Small Business Relief: an election for resident businesses with revenue of AED 3M or less in each tax period, available for tax periods ending on or before 31 December 2029 (Ministerial Decision No. 131 of 2026, extending Ministerial Decision No. 73 of 2023).

Who must register for corporate tax, and by when

Every taxable person needs a corporate tax registration number: mainland companies, free zone companies, and individuals whose business turnover exceeds AED 1 million in a calendar year. That applies whether the company will pay 9% or 0%. The Federal Tax Authority sets the registration deadlines, and the AED 10,000 penalty for missing them applies even when no tax is due.

A dormant company with a live licence is still a taxable person, with the same duty to register and the same exposure to the penalty. If the licence is active, assume you must register. The exemptions are narrow, so confirm one in writing before you rely on it.

How UAE companies can pay 0% corporate tax

There are three routes to 0%. The first is the AED 375,000 band: a company taxed under the standard regime pays 0% on its first AED 375,000 of taxable income each year. That covers mainland companies and free zone companies that are not QFZPs or have elected out. For a small service business, the band alone may mean no tax in the early years.

The second is Small Business Relief, an election in the return for a resident business whose revenue was AED 3M or less in the current tax period and in every earlier one. QFZPs and members of multinational groups cannot use it. The third is QFZP status for free zone companies. Our guide on who still pays 0% explains the three routes and how each one is lost.

QFZP conditions for free zone companies

A free zone company keeps QFZP status only while it meets every condition in every tax period. It needs real substance in the zone (staff, premises and spending in proportion to the income it claims), audited financial statements, transfer-pricing documentation where it deals with related parties, and non-qualifying revenue within the de minimis limit, which is the lower of AED 5M or 5% of total revenue.

The usual failure is gradual. Non-qualifying revenue from mainland customers passes the de minimis limit during the year, nobody reconciles it monthly, and the company loses QFZP status for that tax period and the next four. The problem starts in the books, which is why we treat the QFZP claim and the accounting as one piece of work.

Corporate tax filing deadlines and penalties

The return is due within nine months of the end of the tax period, and so is the payment. For a year ending 31 December 2025, both are due by 30 September 2026. Corporate tax is self-assessed: you compute the tax, file the return and keep the records that support it for the period the law requires.

Penalties are set by Cabinet Decision No. 75 of 2023 as amended, and most of them grow with time. Late registration costs AED 10,000, waived automatically if the first return is filed within seven months of the end of the first tax period. A late return costs AED 500 a month for the first 12 months and AED 1,000 a month after that. Late payment attracts a penalty of 14% a year, charged monthly on the unpaid amount. Because reliefs are claimed in the return, a missed return can cost the relief as well. Our guide to corporate tax deadlines and penalties sets out the full schedule.

How corporate tax connects to VAT and e‑invoicing

Corporate tax uses the same books as VAT (mandatory registration above AED 375,000 of taxable supplies, voluntary from AED 187,500) and e‑invoicing, which becomes mandatory on 1 January 2027 for businesses with revenue of AED 50 million or more and on 1 July 2027 for the rest. Invoices kept to one standard go a long way towards meeting the other two.

Large multinational groups with consolidated revenue of EUR 750M or more are also subject to the 15% Domestic Minimum Top-up Tax, a regime separate from the 9% rate. Few owner-managed UAE companies are affected, but it means 9% is not the ceiling for every business.

Our corporate tax service

We register you and track your deadlines, prepare the annual computation and file the return. Registrations and returns are submitted in your own EmaraTax account and approved by you. If someone other than your company has to act for it before the FTA, for example in a tax audit or a reconsideration request, that must be an FTA-registered tax agent; we tell you if your case needs one. We also review QFZP eligibility in writing: which income qualifies, where the de minimis limit sits for your revenue mix and what substance the zone expects. Where related parties transact, we prepare the transfer-pricing documentation. You can test your own figures first in the corporate tax calculator and bring us the questions it cannot answer.

We set out every position in writing with references, and we keep your books in a state that supports a 0% claim if the FTA asks for evidence. Where company substance overlaps with a personal tax residency position, we plan both together. If a structure is aggressive, we tell you so and explain the risk in plain terms.

Corporate tax service fees and FTA penalty

Frequently asked questions

This is general information on UAE rules. It is not legal, tax or immigration advice for your situation. Rules and government fees change; we confirm the position for your facts in writing before you act.