UAE Corporate Tax Registration & Filing 2026: Rates, Deadlines and Free Zone Rules

Federal corporate tax applies in the UAE to financial years beginning on or after 1 June 2023, and by 2026 the first full cycle of registrations, returns and audits has run. For Indian promoters, the change is significant: a UAE entity is no longer a zero-filing structure. It must register, maintain proper books, file an annual return, and in many cases prepare transfer pricing documentation for dealings with the Indian parent.

0% applies to taxable income up to AED 375,000. 9% applies to taxable income above that threshold. A separate 15% Domestic Minimum Top-up Tax applies to large multinational groups with consolidated global revenue of EUR 750 million or more, in line with the OECD Pillar Two rules. Qualifying Free Zone Persons pay 0% on qualifying income and 9% on everything else.

Every taxable person must register and obtain a Corporate Tax Registration Number through EmaraTax — including free zone companies expecting 0%, and including companies with losses or no activity. Registration is not optional based on profitability. Natural persons conducting business in the UAE must register once annual turnover from that business exceeds AED 1 million. Failure to register by the deadline set for your licence issuance month attracts an AED 10,000 penalty.

The corporate tax return is due within nine months of the end of the tax period, and tax must be paid by the same date. A company with a 31 December 2025 year end therefore files and pays by 30 September 2026. There is no extension mechanism for ordinary cases, and there are no advance instalments — the full liability is settled at filing.

A resident taxable person with revenue of AED 3 million or less in the current and all previous tax periods can elect to be treated as having no taxable income for the period. The relief is available for tax periods ending on or before 31 December 2026 under current legislation. It must be elected in the return; it is not automatic. Companies electing the relief cannot carry forward tax losses or net interest expenditure arising in that period, so run the numbers before electing if you have significant startup losses.

To keep the 0% rate on qualifying income, a free zone entity must maintain adequate substance in the free zone (people, assets and operating expenditure appropriate to the activity), derive qualifying income from qualifying activities, not elect to be taxed at standard rates, comply with transfer pricing rules and documentation, prepare audited financial statements, and stay within the de minimis limits for non-qualifying revenue — the lower of 5% of total revenue or AED 5 million. Breaching de minimis costs the status for the current period and the following four tax periods.

Transactions between the UAE entity and related parties — the Indian parent, sister companies, and connected persons including shareholders and their relatives — must be at arm's length. This covers management fees, intercompany service charges, offshore development work billed from India, royalties, and interest on shareholder loans. Maintain a local file and master file where the group crosses the prescribed thresholds, and a disclosure form accompanies the return regardless. Payments to connected persons are only deductible up to market value.

Start from accounting profit under IFRS, then apply adjustments: add back unrealised gains and losses on capital items where elected, non-deductible expenses (fines, bribes, donations to non-approved bodies, 50% of entertainment expenditure), interest above the 30% EBITDA general interest deduction cap, and related-party amounts above arm's length. Exempt income includes qualifying dividends and capital gains under the participation exemption, and foreign branch profits where the exemption is elected. Tax losses carry forward indefinitely but can only offset up to 75% of taxable income in any period.

Late registration is AED 10,000. Late return filing is AED 500 per month for the first twelve months and AED 1,000 per month thereafter. Late payment carries 14% per annum, calculated monthly on the unpaid amount. Failure to maintain records attracts AED 10,000, rising to AED 20,000 for repeats within twenty-four months. Incorrect returns carry further fixed and percentage-based penalties, reduced significantly by voluntary disclosure.

Register immediately on incorporation. Close books monthly under IFRS rather than annually. Review related-party pricing and refresh benchmarking each year, before the auditor arrives rather than after. Complete the audit within four months of year end, prepare the tax computation in month six, and file in month eight to leave a buffer before the nine-month deadline. Reconcile the corporate tax position with your Indian group's tax reporting to avoid inconsistent treatment of the same intercompany charge.

Wingspan Global Solutions handles corporate tax registration, IFRS bookkeeping, annual tax computations and return filing, Small Business Relief and Qualifying Free Zone Person assessments, transfer pricing documentation for India-UAE related party dealings, and representation during FTA reviews.

The 9% headline rate is easy. The compliance around it — registration, IFRS books, audited accounts, transfer pricing on intercompany charges, and a hard nine-month filing deadline — is what determines whether your UAE entity stays cheap to run.