Small Business Relief: Pay 0% Corporate Tax (Even If You’re Registered)

The UAE’s Corporate Tax system is designed to be business-friendly, especially for startups and small enterprises. Even if your company is registered for Corporate Tax, you may still qualify for 0% tax under Small Business Relief.

What Is Small Business Relief?

Small Business Relief allows businesses with lower profits to pay 0% Corporate Tax, ensuring that smaller companies are not overburdened by the new tax regime.

• Applies to onshore UAE businesses.

• Businesses must meet the annual profit threshold set by the UAE Ministry of Finance.

• Encourages entrepreneurship and supports start-ups and SMEs.

Profit Thresholds for 0% Tax

• Businesses with taxable profits up to AED 375,000 pay 0% Corporate Tax.

• Profits above AED 375,000 are taxed at the standard 9% Corporate Tax rate.

• This threshold ensures micro and small businesses are protected from immediate tax liabilities.

This allows startups to reinvest profits into growth without being burdened by corporate tax.

Who Qualifies for Small Business Relief?

• Onshore companies registered and operating in the UAE.

• Businesses whose annual taxable profits do not exceed AED 375,000.

• Businesses that submit accurate CT filings on time, even if their profits are below the threshold.

Note: Registration for Corporate Tax is still mandatory, even if you qualify for 0% tax. Filing ensures your eligibility for the relief and prevents penalties.

How to Maintain 0% Corporate Tax Under Small Business Relief

• Keep accurate financial records: Ensure all income and expenses are properly documented.

• File your Corporate Tax return on time: Even if your profits are below the threshold, filing is required.

• Monitor profit growth: Businesses exceeding AED 375,000 must prepare for 9% Corporate Tax on the portion above the threshold.