Corporate Tax for Mainland Business, UAE : All You Need to Know

Understanding Corporate Tax for Mainland Business

Corporate tax in the UAE applies to most mainland companies, including LLCs, civil companies, partnerships, and branches of foreign entities. These fall within the ambit of UAE federal laws and the local economic departments. The current framework for corporate tax supports the wider United Arab Emirates economy and ensures conformance with international standards, as well as adherence to the global tax principles introduced under the OECD’s Pillar Two rules for large multinational corporations.

Under the UAE Corporate Tax Law:

• The first AED 375,000 of taxable income is taxed at a rate of 0%
• Everything above that level is taxed at 9% of the amount earned.
• The only industries that have different regulations in place are the extractive industries and some government-related agencies.

Also Read: Top 10 Corporate Tax Consultants in Dubai, UAE

Where are the Mainland Business Areas in Dubai?

The DED-licensed mainland companies can operate anywhere within Dubai. The most common commercial areas are:

• Business Bay
• Sheikh Zayed Road
• Deira
• Downtown Dubai
• Bur Dubai

These zones are within the larger economic area of the mainland, where companies can trade across the UAE with no restrictions.

What is the Step-by-Step Process for Registration ?

All the entities that are mainland based are required compulsorily to register for corporate tax. The simplified process is as under:

1. Review Pre-Registration Requirements

Gather basic documents such as:

• Trade license issued by the DED
• Ownership details
• Business activity information
• Bookkeeping and accounting records; financial books – income statements, expenses, profit figures.
• For LLCs or partnerships, provide the MOA.

2. Prepare Business Information

You will need:

• Type of legal entity: LLC, sole establishment, civil company, joint-stock company
• Business address and contact details
• Financial year dates
• Anticipated annual revenues and taxable income

3. Create or Access Your FTA Account

Log in to the FTA portal through the EmaraTax system.

4. Fill out the online registration form

Provide

• Trade license number
• Issuing authority
• Entity type
• Shareholder or owner information
• Supporting documents (MOA, passport copies, Emirates IDs)

5. Application Submission

Once submitted, the information is reviewed by the FTA and, once approved, the TRN is issued.

6. Track Deadlines

Any business should monitor:

• Deadlines for registration
• Deadlines to File Corporate Tax Returns
• Payment dates linked with the financial year

What are the Benefits of Registration ?

The benefits of corporate tax registration include:

1. Legal Protection and Compliance

Accurate registration will ensure that the business complies with all UAE laws and avoids the AED 10,000 fine due for late registration.

2. Business Credibility

A corporate-tax-registered company is open to:

• Clients
• Banks
• Suppliers
• Governmental bodies

It also fortifies eligibility for government contracts.

3. Availability of Tax Benefits

• Mainland entities benefit from:
• A 0% tax rate up to AED 375,000
• Possible relief for small businesses meeting the revenue limit

4. Stronger Financial Planning

Corporate tax encourages better:

• Record-keeping
• Budgeting
• Long-term financial stability

5. International Recognition

Businesses thus stand to benefit when dealing with jurisdictions that have tax treaties with the UAE, which support cross-border trade.

What is the Difference between Corporate Tax for Mainland  and Free Zone Companies ?

The only free zone companies that enjoy the preferential rates are those that can meet the stringent qualifying income and substance conditions. Mainland firms have straightforward taxation with full access to the UAE market.

What is the Mainland Corporate Tax Rate and Filing Deadlines in Dubai ?

Mainland companies pay:

• 0% on taxable income up to AED 375,000
• 9% on income over that threshold

Filing deadlines:

Every business has to file its annual return and make the payment within nine months from the end of the financial year.

For example:

Financial year ending 31 December 2024 – Corporate tax return due 30 September 2025

Why a Company Chooses Mainland Registration ? – Tax Perspective

Many businesses prefer to register in the mainland for the following reasons:

• It provides full access to the UAE market.
• The entities in the free zone must follow strict regulations to maintain the 0% rate.
• Mainland has simpler and more predictable rules of taxation.
• Companies are free to enter into government contracts.
• Operations involving multiple emirates are easier to handle.
• Pricing for transfers and inter-company transactions is typically easier.

Mainland Corporate Income Tax Liabilities

Mainland companies must comply with the following continuing requirements:

Corporate tax registration with the FTA

• Annual Corporate Tax Return Filing
• Payment of the tax on the tiered rate on profit
• IFRS – Compliant Accounting Records
• Maintaining supporting documents for seven years
• Compliance with the transfer pricing rules
• Ensuring Related Party Transactions are at Arms-Length
• Keeping updated business and shareholder information on the FTA’s EmaraTax platform

Frequently Asked Questions 

1. What is the corporate tax for mainland businesses in the UAE? 

→This is the federal tax under UAE Corporate Tax Law imposed on the taxable income of mainland-registered entities. 

2. Which are the mainland business zones in Dubai? 

→Business Bay, Sheikh Zayed Road, Deira, Downtown Dubai, and Bur Dubai. 

3. Which types of mainland companies fall under corporate tax? 

→These include LLCs, branches of foreign companies, civil companies, sole establishments, and most DED-licensed entities. 

4. What is the process for mainland corporate tax registration? 

→Registration would be done on the FTA’s EmaraTax platform after preparation, including business documents, ownership details, and financial information. 

5. What are the advantages of corporate tax registration on the mainland? 

→Legal compliance, tax protection, credibility, and reaching the 0% threshold. 

6. How does corporate tax differ between mainland and free zone companies? 

→While mainland businesses have to bear 9% above AED 375,000, free zone companies can be zero-rated, provided certain conditions are satisfied.