The UAE Ministry of Finance: Announcing a new tax starting from this date

The Ministry of Finance announced that the United Arab Emirates will introduce a federal tax on business profits that will apply to fiscal years starting on or after June 1, 2023. Businesses in the country will be subject to corporate tax from their first fiscal year starting on or after June 1, 2023.

The ministry said that the corporate tax policy adopted by the state reflects the generally accepted principles within international best practices, noting that the system has been developed taking into account reducing the burden of compliance on businesses. The corporate tax will be calculated on business profits based on their financial statements prepared in accordance with internationally followed accounting standards. She explained that exceptions and amendments will be applied within a limited scope..corporate tax will be applied to all businesses and commercial activities, with the exception of natural resource extraction activities that will remain subject to corporate tax at the level of the local emirate.
She noted that the corporate tax system applied in the country will be among the most competitive systems internationally, as the tax will be applied at a basic rate of 9% and 0% on taxable profits that do not exceed 375,000 dirhams to support start-ups and small businesses.

The Ministry of Finance stated that no corporate tax will be levied on personal income earned from a job, on any other personal income earned through real estate or other investment activities, or on any other income earned by individuals that does not arise from business or any other form of employment. Forms of commercial activity licensed or permitted in the country.