Does the UAE have Corporate Tax and What is the Effective Start Date?

Is there a Corporate Tax in UAE? Is UAE Tax-Free for Business?

UAE Corporate Tax will come into effect on or after 1st June 2023 and will apply to profits generated during financial years starting on or after 1st June 2023.

If your business has a financial year starting on 1st July 2023 and ending on 30th June 2024 will become subject to UAE Corporate Tax from 1st July 2023 (which is the beginning of the first financial year that starts on or after 1st June 2023)

Basis of Calculation for UAE Corporate Tax:

If your business has a (calendar year) financial year starting on 1st January 2023 and ending on 31st December 2023, your business will become subject to UAE Corporate Tax from 1st January 2024 (which is the beginning of the first financial year that starts on or after 1st June 2023)

There is no prescribed requirement to change the financial year to the tax financial year of June – May; however, many entities are likely to change their financial year to be better aligned to the fiscal tax year.

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Note: The information in this article is meant to provide an initial introduction to the proposed UAE Corporate Tax regime and not be used for individual or business decisions as it does not represent the final legislation by the Government. More information on the UAE Corporate Tax regime will be made available in due course.