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What Every Business Should Know About Taxes In UAE: A Comprehensive Look Into The Tax Laws of UAE.

One of the world’s most business-friendly nations is the United Arab Emirates. During the recent past there were few tax laws being proposed, so you must be familiar with them to avoid overpaying or get into any tax penalties for non-compliance. On that note, a tax agency in UAE like Spectrum plays a significant role for business owners by offering knowledgeable direction and aid in negotiating the nation’s tax rules and regulations.

Is UAE Tax-Free? 

The United Arab Emirates tax system- or rather, the absence of a tax system- is one of the main factors in the decision of many expats to settle there so far. But, UAE has come up with some Value Added Tax, Excise Tax and now with Corporate Tax. However there is no tax on the income in the hands of individuals as long as it has not been generated by doing any business and needless to say that there is no tax on the income from salary.

It is crucial for enterprises to comprehend and abide by UAE tax rules and regulations, to avoid penalties and fines. On that note, a tax agency in UAE is the best choice for small business owners to maintain compliance and enhance corporate tax planning.

The TAX Laws of UAE- Federal Taxes 

Income Tax

UAE does not impose any income tax at the moment, and there is no need for an income tax return. However, UAE has announced the Corporate Income Tax for corporations and businesses effective 1 June 2023.

Personal Tax

As mentioned, there is not tax on personal income at the moment.


Value-added tax (VAT) of 5% is levied against small enterprises in the United Arab Emirates and is charged on most products and services. A business must register for VAT if it imports or makes taxable supplies worth more than AED 375,000 in a calendar year. Companies must maintain accurate records of their sales and purchases and timely filing of VAT reports. 

Corporate Tax

Only oil firms and international banks are subject to corporate taxes in the UAE at the moment. However, starting from 1 June 2023, all other companies will have corporate tax applicable.

Tax on property transfers

In the United Arab Emirates, there is a transfer fee. This varies per Emirate; for instance, it is 4% in Dubai. Although this responsibility is shared by the buyer and the seller, the buyer often foots the bill for the transfer fee.

Why Should You Consider a Tax Agency in UAE?

  • By ensuring that all the businesses complies with all applicable tax rules and regulations, a tax agency in UAE may assist in minimizing the risk of fines and penalties.
  • Tax agencies help keep proper financial records and paperwork, which is essential for filing VAT returns and other tax-related reporting obligations.
  • A tax agency may give business owners helpful advice and direction on tax planning, enabling them to reduce their tax obligations and increase their earnings.
  • A tax agency in UAE can represent and help company owners in the case of an audit or a disagreement with the tax authorities.

On that note, Spectrum Accounts, the best tax agency in UAE, can help business owners comply with their tax duties, exercise their related tax rights, and provide the level of support required for business growth. To know more about the services, check out our website.



Balaram Vuchidi

Managing Director
+971 50 9866 466
[email protected]
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