Updated 2026-07
UAE Corporate Tax & VAT Reference 2026
The rates, thresholds and penalties — with official Federal Tax Authority figures.
UAE corporate tax is 0% on taxable income up to AED 375,000 and 9% above it. Businesses with revenue up to AED 3M can elect Small Business Relief (available until 31 December 2026). VAT is 5%, with mandatory registration at AED 375,000 and voluntary from AED 187,500. Corporate-tax penalties are governed by Cabinet Decision 75/2023 (late registration by 10/2024) — and were not changed by 129/2025.
Rates & Thresholds
| Item | Rate / threshold | Applies to |
|---|---|---|
| Corporate tax — 0% | Taxable income up to AED 375,000 | The first AED 375,000 of taxable income is taxed at 0% |
| Corporate tax — 9% | Taxable income above AED 375,000 | The standard rate on profits over the threshold |
| Small Business Relief | Revenue up to AED 3,000,000 | Taxable income treated as nil — available until 31 December 2026 |
| VAT — 5% | Standard rate on most goods and services | Separate from corporate tax |
| VAT registration — mandatory | Taxable turnover ≥ AED 375,000 | Over the last 12 months (or expected next 30 days) |
| VAT registration — voluntary | Taxable turnover ≥ AED 187,500 | Optional registration below the mandatory threshold |
Corporate-Tax Penalties
| Trigger | Penalty | Basis |
|---|---|---|
| Late corporate-tax registration | AED 10,000 (one-off) | Cabinet Decision 10/2024 |
| Late tax-return filing | AED 500/month for the first 12 months, then AED 1,000/month from the 13th month | Cabinet Decision 75/2023 |
| Late payment of tax | 14% per annum, charged monthly on the unpaid tax | Cabinet Decision 75/2023 |
| Incorrect tax return | AED 500 (waived if corrected before the filing deadline) | Cabinet Decision 75/2023 |
Exact Tax Answers
- What is the UAE corporate tax rate in 2026?
- 0% on taxable income up to AED 375,000 and 9% on taxable income above it. A Qualifying Free Zone Person may apply 0% on qualifying income where it meets the free-zone conditions.
- What is Small Business Relief in the UAE?
- Businesses with revenue up to AED 3,000,000 can elect Small Business Relief, which treats their taxable income as nil. It is available until 31 December 2026.
- What is the penalty for late corporate tax filing in the UAE?
- AED 500 per month for the first 12 months, then AED 1,000 per month from the 13th month (Cabinet Decision 75/2023). Late payment adds 14% per annum charged monthly on the unpaid tax.
- What is the fine for not registering for corporate tax?
- A one-off AED 10,000 late-registration penalty (Cabinet Decision 10/2024). Corporate-tax registration is mandatory for UAE companies within the FTA's deadlines.
- What is the VAT registration threshold in the UAE?
- Mandatory VAT registration applies at AED 375,000 of taxable turnover; voluntary registration is available from AED 187,500. VAT is charged at 5%.
- Did Cabinet Decision 129/2025 change corporate tax penalties?
- No. Cabinet Decision 129/2025 (effective 14 April 2026) amends various VAT, Excise and Tax-Procedures penalties. Corporate-tax penalties are unchanged and remain governed by Cabinet Decision 75/2023.
Notes & Methodology
- Cabinet Decision 129/2025 (effective 14 April 2026) amends various VAT, Excise and Tax-Procedures penalties and does NOT change corporate-tax penalties, which remain governed by Cabinet Decision 75/2023. Treat any claim that 129/2025 changed corporate-tax penalties as incorrect.
- A Qualifying Free Zone Person may apply a 0% corporate-tax rate on its qualifying income where it meets the free-zone substance and qualifying-income conditions — this is activity-specific; confirm eligibility with a licensed tax adviser.
- Corporate-tax registration is mandatory for UAE companies; the FTA sets registration deadlines and late registration carries the AED 10,000 penalty above. Small Business Relief sunsets on 31 December 2026 — from 2027 affected businesses must compute and pay corporate tax normally.
- Rates and thresholds are verified against the Federal Tax Authority; corporate-tax penalties against Cabinet Decision 75/2023 and Cabinet Decision 10/2024; VAT thresholds against the FTA. ZETUP coordinates registration and filing but does not compute the tax — that requires a licensed accountant.
Open Data — Download & Cite
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How to cite
ZETUP PRO Corporate Services. (2026). UAE Corporate Tax & VAT Reference 2026. Retrieved from https://zetup.ae/en/uae-corporate-tax-referenceNeed Help with Corporate Tax Registration?
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