Accounting services in Dubai

No, family-owned businesses are treated like any other legal entities. If structured properly, they can still benefit from tax exemptions, group relief, and loss carryforward. Succession planning and documentation are important to maintain tax compliance and continuity. Tax advisors can help structure family businesses for long-term efficiency.

There are no specific startup exemptions, but if your income is below AED 375,000, no tax is payable even though registration is required. Some free zone startups may qualify for 0% tax under qualifying activity conditions. You must still file returns and maintain compliance. Structuring your business wisely from the start can maximize benefits.

Salaries paid to owners or shareholders who also work in the business may be deductible if they are reasonable and justified. However, distributions or dividends are not deductible. Documentation such as contracts and payment records must support the salary expense. Misclassifying distributions as salaries can lead to tax penalties.

Yes, businesses can carry forward tax losses to offset future profits.

Audited statements are not yet mandatory for all, but they are highly recommended.

Yes, even businesses with income below the threshold must register, though they may not owe any tax.

Related party transactions must follow the arm’s length principle and be properly documented. Disclosure forms and possibly transfer pricing documentation must be filed. Inaccurate reporting or failure to maintain documentation can lead to adjustments or penalties. Transparency is key when dealing with intercompany transactions.

Taxable income is calculated by taking your net accounting profit and adjusting it for tax-exempt income, non-deductible expenses, and tax losses carried forward. Certain income like dividends or capital gains may be excluded if conditions are met. The resulting figure is taxed at the applicable rate (typically 9% over AED 375,000). Accurate financial reporting and professional accounting are essential for correct tax computation.

International income, such as income from foreign subsidiaries, may be taxed unless an exemption applies. The UAE applies the “Participation Exemption” for qualifying foreign shareholdings. Double tax treaties can also reduce or eliminate foreign tax exposure. Careful planning helps avoid double taxation and ensures compliance in all jurisdictions involved.

Corporate tax is applied on net profit, not revenue.

Foreign income is generally included in taxable income unless specifically exempt

Taxable income includes profits from business activities after deducting allowable expenses.

The UAE corporate tax rate is 9% on taxable income exceeding AED 375,000.

GAAR allows tax authorities to disregard transactions or structures aimed solely at avoiding tax without genuine business substance. Even if actions are legally structured, they may be recharacterized if lacking economic intent. Businesses must ensure their operations reflect real commercial activity. Aggressive tax planning without substance increases audit risk.

All UAE-registered companies, including those with full foreign ownership, are subject to corporate tax on their UAE-sourced income. However, foreign entities operating without a permanent establishment may be exempt. The law applies uniformly, ensuring fair treatment across ownership types. Proper tax structuring can help foreign businesses remain compliant while optimizing global tax exposure.

Investment holding companies are subject to corporate tax but may benefit from exemptions on qualifying dividends and capital gains. They must meet substance requirements and proper ownership structures to qualify. Tax planning is critical when using UAE entities for holding international assets or shares. Consult a tax advisor to ensure the correct structure.

Penalties may include fixed fines, a percentage of unpaid tax, and daily interest. Late filings, failure to register, or inaccurate reporting are all penalized under Federal Tax Authority (FTA) guidelines. Keeping accurate records and meeting deadlines is the best way to avoid fines. Working with a tax consultant can ensure timely and accurate submissions.

Corporate tax applies to all businesses and commercial activities, except those exempt (like oil extraction or government entities).

Tax returns must be filed within 9 months from the end of your financial year.

Free zone companies meeting substance and compliance requirements may qualify for exemption; also, personal income is not taxed.