Two taxes, one authority
A company licensed in the UAE deals with two federal taxes: Corporate Tax and Value Added Tax (VAT). Both are administered by the Federal Tax Authority (FTA) and both are registered through its online portal, EmaraTax.
The two have different triggers. Corporate Tax registration applies to every company, mainland or free zone, whether or not it owes anything. VAT registration depends on turnover. Many new owners confuse the two and either register for neither or pay a consultant for a VAT registration they do not need.
Rules, thresholds and penalties are set by federal law and FTA decisions that are updated from time to time. The figures below are correct as we read them in October 2026. Check the FTA website before you act on a deadline.
Corporate Tax: who registers and what rate applies
Corporate Tax is charged at 0 percent on taxable income up to AED 375,000 and 9 percent on the part above it, for financial years starting on or after 1 June 2023. Every juridical person licensed in the UAE must register, including a free zone company that expects to pay nothing.
A Qualifying Free Zone Person can pay 0 percent on qualifying income if it meets the substance and activity conditions, and 9 percent on the rest. The conditions are detailed, and income from mainland customers is often not qualifying, so take advice before you assume the 0 percent rate.
Small Business Relief can apply to companies with revenue up to AED 3 million for a limited number of tax periods. The relief has an end date that the Ministry of Finance can extend, so check the current end date on mof.gov.ae or tax.gov.ae before you rely on it. It is not automatic: you elect it in the return, and some businesses, such as Qualifying Free Zone Persons, are excluded. Ask your accountant if you qualify.
A new company should register within the deadline the FTA gives for its licence date, which for newly incorporated companies is generally within three months of incorporation. Late registration carries a fixed penalty set by the Federal Tax Authority. The amounts were revised in April 2026, so check the current figure at tax.gov.ae.
VAT: the thresholds and the 30-day rule
VAT is charged at 5 percent on most goods and services. You must register when your taxable supplies in the previous 12 months exceeded AED 375,000, or you expect them to exceed it in the next 30 days. You may register voluntarily from AED 187,500.
The 30-day rule is the one that catches new businesses. A company that signs a single contract worth AED 400,000 must register within 30 days of knowing it. Late registration carries a fixed penalty set by the Federal Tax Authority. The amounts were revised in April 2026, so check the current figure at tax.gov.ae.
Once registered, you receive a Tax Registration Number (TRN), you add 5 percent to your invoices, and you file a return, usually quarterly, within 28 days of the end of each tax period. Late filing carries fixed penalties set by the Federal Tax Authority, plus penalties on unpaid tax. The penalty table was revised in April 2026, so check current amounts at tax.gov.ae.
What you need to register
For both registrations on EmaraTax, prepare the trade licence, the memorandum of association, passport and Emirates ID of the owners and the authorised signatory, the company's contact details and bank account (IBAN), and the licence issue date.
For VAT, you also need evidence of turnover, such as contracts, invoices or bank statements, and a description of your supplies, imports and exports. For Corporate Tax, you state the financial year end and the type of persons who own the company.
Create the EmaraTax account in the name of a person who is named in the licence.
Records, invoices and the return
Corporate Tax returns are due within nine months of the end of the financial year. For a company with a 31 December year end, that is 30 September of the following year. Keep accounting records for seven years.
A VAT invoice must show the words tax invoice, the supplier's name, address and TRN, the customer's details, the date, a description, the amount before VAT, the VAT amount and the total. Most accounting software produces compliant invoices, which is a good reason to start with software on day one.
A typical bookkeeping package from an accounting firm costs AED 500 to 2,000 a month. VAT registration through a firm costs about AED 500 to 1,500 and a quarterly VAT return AED 300 to 1,000. Our guide to choosing an accountant explains how to pick one.
A first-90-days checklist
Do these in order after the licence is issued.
- Open the EmaraTax account and register for Corporate Tax. Save the registration certificate.
- Choose bookkeeping software and set up the chart of accounts. Record every transaction from day one.
- Open a business bank account and keep company and personal money separate.
- Track taxable turnover each month against AED 375,000 and the 30-day rule. Set a calendar alert at AED 300,000.
- Register for VAT when you cross the threshold, or earlier if you want to reclaim VAT on large purchases.
- Put the Corporate Tax return date, VAT return dates and licence renewal in one calendar and share it with your accountant.
- Keep every invoice, contract and bank statement in one folder for seven years.
If you missed a deadline
Do not wait for the penalty notice. Register or file as soon as you notice, because penalties are fixed amounts and delay does not reduce them.
Log in to EmaraTax and check the penalty status. The FTA lets you request a reconsideration of an administrative penalty within the statutory period, and a clear first-time explanation sometimes succeeds. Your accountant or a registered tax agent can file it for you.
If you are not sure you ever needed to register, a tax agent can review your turnover and the licence history and tell you whether to act. Registering before the FTA contacts you is better than registering after.
Any AED amounts in this guide are typical ranges for Dubai as of October 2026; prices in other emirates are often similar or lower. They are not quotes and not offers: real prices depend on the job, the company and the date, so ask for written quotes.
Frequently asked questions
Does a free zone company have to register for Corporate Tax?
Yes. Every juridical person licensed in the UAE registers with the Federal Tax Authority, even if its income is taxed at 0 percent. Late registration carries a fixed penalty set by the Federal Tax Authority. The amounts were revised in April 2026, so check the current figure at tax.gov.ae.
When must I register for VAT in the UAE?
When taxable supplies in the past 12 months exceeded AED 375,000, or you expect to exceed it in the next 30 days. Voluntary registration is possible from AED 187,500.
How much do accountants charge to register a company for VAT?
A firm typically charges AED 500 to 1,500 for VAT registration, and AED 300 to 1,000 per quarterly return. The price depends on how clean your records are.
Can I register without an accountant?
Yes. EmaraTax is designed for owners to use directly. An accountant is worth paying once you have invoices, expenses and a return to prepare, because mistakes in those cost more than the registration itself.
