Tax-Free No More: Clarifying UAE’s Ground-breaking Corporate Tax Shift

A major shift is happening in UAE. The Federal Tax Authority (FTA) will introduce a 9% corporation tax.

We are explaining the implications of this substantial policy change.


This new mandate is applicable to all business entities across the UAE, including those within onshore and Free Zone jurisdictions.

Who is affected?

  • On-shore entities, as well as Free Zone entities involved in transactions with on-shore entities, will be subjected to a 9% corporation tax.

If your business turnover exceeds AED 375,000 per year, you’ll be subject to the new 9% corporate tax.


Who is exempted?

  • Free Zone entities engaged exclusively in overseas business transactions will be subject to a 0% corporation tax. However, these entities must submit their accounts to the FTA, justifying this exemption.
  • Personal Income: Income from employment, investments, and real estate (without licensing requirements) will not be taxed. For example, income from rental property and personal investments is exempted. For UAE residents drawing a single income stream from salary, the current tax status remains unchanged with a tax rate of 0%.


Furter to the above, all entitied must register for corporation tax and show their accounts to the FTA.

Failure to comply or register for corporation tax could lead to considerable financial penalties. Prompt action is advisable.


How can IBCCS TAX CY help?

IBCCS TAX CY can assist you in this big change, and provide services to UAE Entities and individuals ensuring compliance with UAE development.

For further inquiries, please contact us by email at or call our office in Cyprus at +357 222 58 777.