Accounting in Dubai, what founders need to know
An overview of VAT, Corporate Tax and Free Zone specifics for entrepreneurs setting up in the UAE.
Introduction
If you set up a company in the UAE, you face a very different tax landscape from the one you may be used to. This article gives you an overview.
VAT, Value Added Tax
Since 2018, the UAE has applied a value added tax of 5%. Registration is mandatory once turnover reaches AED 375,000 per year.
Corporate Tax, 9%
Since June 2023, Corporate Tax of 9% applies to profits above AED 375,000. Free Zone companies can retain 0% under certain conditions.
Free Zones vs. Mainland
The most important decision: where do you incorporate? Free Zones have their own rules, often cheaper, but not suited to every business model.
Conclusion
Get advice before you incorporate. A 30 minute initial consultation often saves many thousands of dirhams.