Taxes in the UAE: every tax, rate and threshold on one page

The UAE runs a small, clearly defined set of taxes. Under the standard rules corporate tax is 9% on taxable income above AED 375,000 (0% below), VAT is 5%, excise applies at 100% or per litre on a short list of goods, and customs duty is 5% on most mainland imports. A 15% DMTT reaches only very large multinational groups. There is still no personal income tax and no capital gains, dividend or inheritance tax for individuals. Government fees, such as housing fees and property transfer fees, are a separate cost that “tax-free” always left out.

The UAE tax system in brief

For most of its history the UAE had no federal business tax. That changed for tax periods starting on or after 1 June 2023, when Federal Decree-Law No. 47 of 2022 introduced federal corporate tax. The UAE remains a low-tax country, now with a defined system: a handful of taxes, each with a clear rate and threshold, plus government fees that were always there.

This page covers what the UAE charges, at what rate, and what it does not tax at all. The figures are current published rates as of the date above.

Corporate tax: 9% and the 0% routes

Under the standard rules, taxable income up to AED 375,000 is taxed at 0% and income above it at 9%. The tax is charged on accounting profit adjusted for the tax rules, not on revenue.

Two other routes can keep profit at 0%. Small Business Relief treats a resident business with revenue of up to AED 3M as having no taxable income, for tax periods ending on or before 31 December 2029. A Qualifying Free Zone Person pays 0% on qualifying income and 9% on other taxable income, with no AED 375,000 band, as long as the substance, de minimis and audit conditions are met. The details are in who pays 0% corporate tax, and the corporate tax calculator gives a first estimate.

VAT, excise and customs duty

VAT is 5%, one of the lowest standard rates anywhere. Registration is mandatory once taxable supplies and imports exceed AED 375,000 over the past 12 months, and voluntary from AED 187,500. Exports outside the GCC are generally zero-rated, and some sectors (certain healthcare, education and residential property) are zero-rated or exempt. See our VAT service and the guide to VAT registration.

Excise tax applies to a short list of goods: 100% on tobacco products, electronic smoking devices and liquids, and energy drinks; and, since 1 January 2026, a per-litre charge on sweetened drinks by sugar content (AED 1.09 or AED 0.79 per litre, and AED 0 below 5 g per 100 ml, a tier that is still registered and reported). Businesses that do not deal in these goods never pay excise. Our excise tax guide has the details.

Customs duty is generally 5% of the CIF value of goods imported into the mainland, with many categories reduced or exempt. Goods that stay inside a free zone, or pass through one, are generally outside customs duty until they enter the local market.

Domestic Minimum Top-up Tax (DMTT) for large groups

From 2025 the UAE applies a Domestic Minimum Top-up Tax (DMTT) of 15%, in line with the OECD Pillar Two minimum. It applies only to multinational groups with consolidated revenue of EUR 750 million or more in at least two of the four preceding years. Ordinary SMEs, single-country businesses and founder-owned companies are outside its scope and stay under the 9% rules.

Every UAE tax on one line

The full list is short:

Taxes the UAE does not charge

The taxes the UAE does not have are a large part of its appeal. There is no personal income tax on salaries or business drawings, no capital gains or dividend tax for individuals, no inheritance or wealth tax, and no social security contributions for expatriate staff (UAE and GCC nationals have their own pension schemes). A founder taking profit out of a UAE company pays tax once, at company level.

Government fees and total cost

Government fees are the part “tax-free” always left out: municipality housing fees on residential and commercial rent, the 4% property transfer fee in Dubai, tourism fees on hotel stays, and licence issue and renewal fees every year. None is called a tax, but together they are often the largest predictable cost in a small company’s budget.

Two compliance changes are worth planning for. E‑invoicing becomes mandatory for B2B and B2G invoices from 1 January 2027 for businesses with revenue of AED 50 million or more, and from 1 July 2027 for everyone else; see our e‑invoicing guide. And with corporate tax in place, bookkeeping is required in practice, because every 0% position depends on the books. When comparing the UAE with another country, compare the total cost of operating: rates, fees and compliance together.

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.