The United Arab Emirates (UAE) has for years attracted investors and entrepreneurs from around the world thanks to its favourable tax system. The absence of personal income tax and low rates of corporate income tax make the UAE an attractive place to run a business.
Key Information About the UAE Tax System
No Personal Income Tax
One of the main advantages of the UAE is the absence of personal income tax. This means that both residents and non-residents are not required to pay tax on their personal income, which allows you to keep your full earnings.
Corporate Income Tax (CIT)
Since June 2023, the UAE has applied a 9% corporate income tax (CIT) to companies whose annual income exceeds AED 375,000. Companies operating in Free Zones may benefit from preferential tax rates, provided they meet certain criteria.
Value Added Tax (VAT)
VAT, introduced in 2018, is charged at a standard rate of 5%. Companies whose annual turnover exceeds AED 375,000 are required to register for VAT. For companies with turnover above AED 187,500, registration is optional.
No Capital Gains Tax or Dividend Tax
The UAE does not impose tax on capital gains or dividends, which makes it an attractive location for investors seeking efficient tax structures.
Benefits for Business Owners
- Efficient tax planning: The absence of personal income tax and low CIT rates make it possible to optimise your tax burden.
- Stable business environment: The UAE offers political and economic stability, which supports long-term business planning.
- Access to international markets: A convenient geographical location and well-developed logistics infrastructure provide easy access to the markets of Asia, Europe and Africa.
How to Set Up a Company in the UAE
The process of setting up a company in the UAE is relatively simple and can be completed online. It requires choosing a suitable legal form, registering with the relevant authorities and meeting specific licensing requirements. Companies can operate both on the Mainland and in Free Zones, which offer additional tax and regulatory benefits.
If you are considering starting a business in the United Arab Emirates or need support with tax planning, please contact us. Our experts will help you make full use of the opportunities offered by the UAE tax system.
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🌐 www.globaltax.partners
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