The UAE has confirmed it will introduce a federal Corporate Tax for financial years starting on or after 1 June 2023. For a country built on a no-tax reputation, this is a structural shift — and the businesses that prepare early will have the easiest first filing.
What has been announced
The headline rate is 9% on taxable profits, with a 0% band on the first AED 375,000 to protect small businesses and start-ups. Free-zone businesses that meet the qualifying conditions are expected to keep a preferential rate on qualifying income. Detailed rules will follow in the law and its decisions — but the direction is set.
What to do now, before it arrives
Three things are worth starting today: get your bookkeeping clean and current so you can compute taxable income when the time comes; review your group and free-zone structure while there is time to adjust; and map your related-party transactions, because transfer-pricing discipline will matter. None of this is wasted effort — it is good housekeeping regardless.
Written in 2022 as the Corporate Tax regime was announced; rules have since been finalised. See our current UAE Corporate Tax guide for the position as enacted.