UAE CT Rate Comparison — Free Zone 0% vs Mainland 9% Calculator 2026
UAE Corporate Tax (CT) introduces a 9% tax on taxable income above AED 375,000 for standard companies. Free zone QFZP companies qualify for 0% CT on qualifying income. This comparison tool helps you calculate the CT impact of free zone vs mainland structure on your specific business in 2026.
In this guide:
- UAE CT Rate Comparison — Free Zone 0% vs Mainland 9% Calculator 2026
- UAE CT Rates Summary
- CT Calculation Example: International Consulting Business
- CT Calculation Example: Mixed UAE/International Business
- When Mainland CT Liability Exceeds Free Zone Cost Saving
- Key CT Considerations Before Choosing Structure
UAE CT Rates Summary
- Mainland company: 9% on taxable income above AED 375,000; 0% up to AED 375,000
- Free zone QFZP (qualifying): 0% on qualifying income; 9% on non-qualifying income
- Small Business Relief: both mainland and free zone companies below AED 3M revenue and AED 375,000 taxable income: elect 0% CT
CT Calculation Example: International Consulting Business
Revenue: AED 1M (all from non-UAE clients)
- As mainland company: taxable income AED 700,000 (after AED 300K expenses); CT = 9% × (700,000 – 375,000) = AED 29,250
- As free zone QFZP: same revenue, same expenses; if all from non-UAE clients = qualifying income; CT = 0%; saving AED 29,250/year
CT Calculation Example: Mixed UAE/International Business
Revenue: AED 1.5M (50% UAE clients, 50% international clients)
- Qualifying income: AED 750,000 (international); Non-qualifying: AED 750,000 (UAE)
- As QFZP: CT = 9% × (non-qualifying taxable income above AED 375,000 threshold); calculation complex; seek UAE CT advice
- As mainland company: CT = 9% × (total taxable income above AED 375,000); straightforward 9% rate applies to everything
When Mainland CT Liability Exceeds Free Zone Cost Saving
- High UAE revenue: if most revenue is from UAE clients (non-qualifying for QFZP), free zone’s 0% advantage erodes
- Low profit margin: if net profit is below AED 375,000, CT is 0% regardless of mainland vs free zone (Small Business Relief)
Key CT Considerations Before Choosing Structure
- Substance requirements: QFZP requires real UAE substance; cost of substance (employees, office) may offset CT saving for small businesses
- Complexity: QFZP requires careful income tracking; mixed-income QFZP is complex; professional UAE CT adviser is needed
- Changes: UAE CT law is new; QFZP rules are still being clarified by FTA guidance