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UAE Corporate Tax Rate Calculator — Estimate Your CT Liability Guide 2026
UAE Corporate Tax (CT) at 9% applies to taxable income above AED 375,000. Understanding how to calculate your UAE CT liability helps with financial planning and cash flow management. This guide explains UAE CT calculation with practical examples for 2026.
In this guide:
UAE CT Rate Structure
- 0%: taxable income up to AED 375,000 (per financial year); small business relief threshold; most small free zone businesses pay no CT if under this threshold
- 9%: taxable income above AED 375,000; applies to the amount ABOVE AED 375,000 (not total income)
- 15% (Pillar Two): UAE’s Domestic Minimum Top-Up Tax (DMTT) applies at 15% for large multinational enterprise (MNE) groups with global revenues exceeding EUR 750 million; only affects very large MNEs
UAE CT Calculation — Step by Step
- Start with accounting profit: your net profit per financial statements (revenue minus all deductible expenses)
- Add back non-deductible expenses: entertainment (50% deductible; add back 50%); penalties and fines; donations not to approved UAE charities; bribes (never deductible)
- Subtract exempt income: qualifying dividends (from UAE subsidiary); qualifying gains on disposal of shares; other specifically exempt income
- Apply Small Business Relief (SBR) if eligible: if total revenue under AED 3 million, elect SBR; taxable income deemed zero for that year (0% CT); file election with CT return
- Calculate taxable income: accounting profit +/- adjustments
- Apply CT rates: first AED 375,000 = AED 0; balance x 9% = your CT liability
UAE CT Examples
- Example 1 (small business, AED 250,000 profit): Taxable income AED 250,000; below AED 375,000 threshold; UAE CT = AED 0
- Example 2 (growing business, AED 600,000 profit): Taxable income AED 600,000; first AED 375,000 @ 0% = AED 0; next AED 225,000 @ 9% = AED 20,250; Total CT = AED 20,250
- Example 3 (profitable free zone business, AED 2,000,000 profit): If QFZP (Qualifying Free Zone Person) earning qualifying income = 0% CT; if not QFZP or earning non-qualifying income = first AED 375,000 @ 0%, next AED 1,625,000 @ 9% = AED 146,250 CT
- Example 4 (mainland company, AED 1,000,000 profit): First AED 375,000 @ 0% = AED 0; next AED 625,000 @ 9% = AED 56,250; Total CT = AED 56,250
UAE CT Deductions to Reduce Your Liability
- Salaries and wages: fully deductible if paid to genuine UAE employees under valid employment contracts
- Rent: office and warehouse rent fully deductible
- Interest on business loans: up to 30% of EBITDA (Earnings Before Interest, Taxes, Depreciation, Amortisation) limitation applies to net interest; excess carried forward
- Depreciation: on UAE business assets per accounting standards; no special tax depreciation schedule (follows IFRS/GAAP)
- Professional fees: accountant, lawyer, consultant fees; fully deductible
- Marketing and advertising: fully deductible for business-related promotion
- UAE donations: to UAE Cabinet-approved charities; fully deductible; keep receipts and verify charity is on the approved list
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