Tax and money in the UAE

The UAE does not levy income tax on individuals; it levies 5% VAT, excise tax on specific goods, and corporate tax on business profits.

Corporate tax (Federal Decree-Law No. 47 of 2022) applies to financial years beginning on or after 1 June 2023.

Corporate tax rate: 0% on taxable income up to AED 375,000 and 9% on taxable income above AED 375,000.

The FTA applies the same 0% / 9% bands to natural persons: 0% on the portion of Taxable Income not exceeding AED 375,000 and 9% on the portion above.

A resident or non-resident natural person's business activity is subject to corporate tax only where total Turnover from it exceeds AED 1,000,000 within a Gregorian calendar year.

Turnover is defined as the gross amount of income derived during a Gregorian calendar year.

Wage, personal investment income and real estate investment income of a natural person are not treated as business activities for corporate tax, regardless of amount.

An employee's salary or other remuneration from an employer does not fall within the scope of corporate tax.

A natural person with business turnover not exceeding AED 1 million in a calendar year is not subject to corporate tax and does not need to register.

The first potential corporate tax period for a natural person is the 2024 Gregorian calendar year; the tax period is 1 January to 31 December.

A natural person whose turnover exceeds AED 1 million must register for corporate tax by 31 March of the calendar year following the year in which turnover exceeded the threshold.

FTA worked example: turnover exceeding AED 1 million during 2024 means registration by 31 March 2025 and a corporate tax return by 30 September 2025.

Taxable persons file a corporate tax return within 9 months of the end of the tax period; the same deadline generally applies to payment.

Failing to submit a corporate tax registration application on time carries an administrative penalty of AED 10,000.

A natural person who stays registered while turnover is under AED 1 million files only a 'nil' tax return.

Corporate tax registration is done through the FTA's EmaraTax platform.

FTA services are only available through UAE Pass.

UAE PASS is the first national digital identity and signature solution, using smartphone-based authentication and digital document signing.

Small Business Relief: a resident taxable person (natural or juridical) with revenue of AED 3,000,000 or less in the relevant and all previous tax periods can elect to be treated as having no taxable income.

The AED 3,000,000 Small Business Relief threshold applies to tax periods starting on or after 1 June 2023 and ending on or before 31 December 2029. Ministerial Decision No. 131 of 2026 moved the end date from 31 December 2026.

Once revenue exceeds AED 3 million in any tax period, Small Business Relief is no longer available, even if later revenue falls below the threshold.

A natural person taxable for corporate tax may use cash-basis accounting if turnover does not exceed AED 3 million.

VAT is levied at a standard rate of 5%.

Mandatory VAT registration threshold: taxable supplies and imports exceeding AED 375,000.

Voluntary VAT registration threshold: taxable supplies and imports (or taxable expenses) exceeding AED 187,500.

Mandatory VAT registration also applies where a business expects taxable supplies and imports to exceed AED 375,000 in the next 30 days; the past-12-months test is otherwise used.

A person required to register for VAT must apply to the FTA within 30 days of being required to register.

UAE VAT is zero-rated on exports of services. One qualifying case: the client has no place of residence in an 'Implementing State' and is outside the UAE when the service is performed. The FTA says the UAE currently treats no other state as an Implementing State, so in practice the test is no place of residence in the UAE. Further conditions apply.

Under domestic rules a natural person is a UAE tax resident if physically present in the UAE for 183 days or more within the relevant 12 consecutive months.

The 183 days need not be consecutive, and all days or parts of a day of physical presence count.

Alternative residency routes: 90 days or more in the UAE in the relevant 12 months, if you are a UAE or GCC national or hold a valid UAE residence permit and also have a permanent place of residence or employment or a business in the UAE; or your usual or primary place of residence and centre of financial and personal interests are in the UAE.

UAE Ministerial Decision 27 of 2023 says a 'Permanent Place of Residence' need not be owned and can be rented or otherwise occupied as a dwelling.

Tax Residency Certificate for individuals via FTA: applicants under the 183-day case provide an Emirates ID or a passport with an official entry/exit report.

FTA Tax Residency Certificate fees: AED 50 submission fee, AED 1,000 for a natural person without a corporate tax TRN, AED 250 per hard copy; processing is 10 business days.

A Tax Residency Certificate covers a tax period or a selected 12-month period; it cannot cover a future period or more than 12 months.

FTA issues Tax Residency Certificates so a UAE tax resident can use the provisions of Double Taxation Agreements in effect; for DTA purposes the residency test is the one in the applicable DTA.

Bank account opening (u.ae): commonly required documents include Emirates ID, valid UAE residence visa, passport, and salary certificate or employment letter; self-employed applicants may need a trade licence and company documents.

Under the CBUAE SME Customer Protection Regulation (Circular 2/2026, effective 13 September 2026, which cancelled the 2021 SME Market Conduct Regulation), banks must have systems to complete the opening of an SME customer's account within three business days where the applicant is assessed as low money-laundering risk and has standard due-diligence documents. The clock starts once all required documents are provided.