😨 Corporate Tax Sounds Scary — But It Doesn’t Have to Be

The moment people hear “corporate tax in the UAE”, they freeze. But here’s what most people — even some consultants — completely miss:

✅ The UAE corporate tax only applies to profits over AED 375,000.
✅ If your total revenue is under AED 3 million, you could pay zero tax under the Small Business Relief Program.

Let’s break it down so you don’t miss out on legitimate tax relief opportunities.

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💡 How UAE Corporate Tax Actually Works

Since 2023, the UAE has implemented a 9% corporate tax on business profits.

But here’s the fine print:

• 0% tax on profits up to AED 375,000
• Only 9% on profits beyond that
• Small Business Relief applies to companies earning less than AED 3 million in total revenue per year

So unless your business is scaling fast, you may not owe any corporate tax at all — legally.

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🏝️ Free Zone Doesn’t Always Mean Tax-Free

Many entrepreneurs think that setting up in a Free Zone means they’re 100% exempt from tax. But that’s only true under certain conditions.

Here’s where it gets tricky:

• If your Free Zone company only deals with other Free Zone clients, you may qualify as a Qualifying Free Zone Person (QFZP) and maintain 0% tax.
• But if you’re doing business with Mainland clients, even partially, you may still be subject to corporate tax — based on the percentage of your total revenue coming from the Mainland.

This is where business structuring becomes critical.

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🔍 Structuring Is Everything

A well-planned structure can legally minimise your corporate tax liability.

For example:

• Splitting Mainland vs. Free Zone revenue across entities
• Using holding company models
• Planning invoicing and contracting methods strategically
• Taking advantage of Small Business Relief while it lasts (up to 2026)

It’s not about bending the rules. It’s about understanding them — and using them to your advantage from the beginning.

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📈 Regular Reviews Keep You Ahead

Setting up the right structure is just the first step. UAE tax laws are still evolving, and regular compliance reviews can:

• Spot new savings opportunities
• Keep your QFZP status valid
• Avoid fines and penalties

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👥 Want to Legally Minimise Your Tax?

Whether you’re just starting out or restructuring an existing business, the right approach can save you thousands every year.

Book a free consultation and I’ll help you map out the best corporate tax structure for your situation — both for today and for when your business grows.