Part of Oznet Group
UAE corporate tax: the position you think you have, evidenced.
Corporate tax arrived in the UAE recently enough that a great many businesses are operating on assumptions rather than analysis. The most common assumption — “we’re in a free zone, so we’re at zero” — is the most expensive one.
What it actually requires.
Every taxable person must register, maintain accounting records, and file a return within nine months of the end of the tax period. For a financial year ending 31 December 2025, that means a return and payment due by 30 September 2026. The rate is 9% on taxable income above the AED 375,000 threshold.
Free zone entities are not outside this. They are inside it, with the possibility of a 0% rate on qualifying income — which is a different thing entirely from being exempt.
Four conditions, all of which must hold.
We are asked to review this position more often than any other, and it repays checking carefully.
Qualifying income
The income itself has to be of a type the regime treats as qualifying — not simply earned by an entity sitting in a free zone.
Adequate substance
Real activity, staff and premises in the free zone itself — a registered address is not substance.
Transfer pricing compliance
Documentation prepared and maintained for related-party transactions, not reconstructed if the position is ever queried.
Non-qualifying revenue limits
Revenue outside the qualifying categories has to stay within the permitted limits, or it can taint the entire entity’s status.
All four must hold for the entity to keep qualifying status — and the consequence of a breach is not confined to the transaction. The entity is taxed at 9% on all of its income for that tax period and the four that follow.
Registration through to an honest recommendation.
Registration & filings
Corporate tax registration and return filing, tracked against your actual tax period.
A written position paper
Whether qualifying status is genuinely available to your business, and how to evidence it if it is.
Transfer pricing & substance
Documentation and substance reviews — and where the position doesn’t hold, an honest recommendation to restructure or to accept the 9% and plan properly around it.
The deadline that catches people: registration deadlines and filing deadlines are different, and penalties apply to both independently. Businesses that registered on time still incur penalties for late filing. Our compliance calendar tracks both.
Not sure where to start? Forty minutes, no cost, no licence quoted.
Your activity, your customers, your visas — and a written view of the structure that fits, with the case against it. The person you speak to is the person who keeps your file.
What clients ask before their first filing.
Do I have to register for corporate tax in the UAE if I pay 0%?
Yes. Registration and liability are separate questions. A business expecting a 0% outcome — whether through Qualifying Free Zone Person status or Small Business Relief — still has to register with the FTA and still has to file. Late registration carries an administrative penalty of AED 10,000 regardless of the tax due.
Are free zone companies exempt from corporate tax?
No. They’re inside the regime like everyone else, with the possibility of a 0% rate on qualifying income only — a status maintained continuously, not an exemption granted at licensing.
What’s the actual deadline for our return?
Nine months after the end of your tax period. For a financial year ending 31 December 2025, that’s 30 September 2026. It changes with your entity’s own financial year-end.
What happens if we lose Qualifying Free Zone Person status?
The entity is taxed at 9% on all of its income for that tax period and the four tax periods after it — five periods in total, not just the single transaction that broke a condition. The de minimis limit is also stricter than it is usually quoted: non-qualifying revenue must stay below 5% of total revenue or AED 5 million, whichever is lower.
Do registration and filing have separate penalties?
Yes. A business that registered on time can still be penalised for filing late — the two deadlines are tracked and penalised independently.
Can you tell us definitively whether we qualify for 0%?
We give you a written position based on your actual income, substance and documentation — the honest answer sometimes being that the position doesn’t hold and 9% should be planned for properly instead.
Two practices, twelve services — and the same advisor across all of them.
Corporate advisory & formation
- Structure & jurisdiction advisory Mainland, free zone or offshore — decided first
- Company formation Mainland and free zone, executed against the agreed structure
- Bank account opening The file a bank actually approves
- Residency & Golden Visa Investor, employment, family
- Capital, funding & joint ventures Readiness first, introductions second
- Trademark & IP A licence is not a trademark
Accounting & taxation
- Bookkeeping & management accounts Odoo, Zoho Books, QuickBooks
- UAE corporate tax Registration, returns, the qualifying position
- VAT & e-invoicing Returns, and readiness for the phased mandate
- Audit support The file prepared as a review, not a reconstruction
- Payroll & WPS Salary processing that satisfies the Wage Protection System
- Compliance calendar Every dated deadline, one page, one PDF
A conversation before a quotation.
Forty minutes with an advisor who will look at the position you think you have, and tell you whether it actually holds. Tax treatment depends on your activities, structure, income and the law as it stands; we give you a reasoned position and the evidence for it, not a promise about the outcome of an FTA review.
Prefer to talk now? WhatsApp +971 50 175 2489 · inquiries@oznetcorp.com
Last reviewed September 2026 by the Oznet Corp advisory team.