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Is there a Corporate Tax-free amount of profit?

Answered by TI from the Federal Tax Authority’s own law · 25 September 2026. Guidance, not tax advice: rely on the official text.

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Yes - the first slice of your taxable profit is taxed at 0%, and only the amount above a threshold set by the Cabinet is taxed at 9%. The exact AED threshold isn't in the sources provided, so check the relevant Cabinet Decision for the current figure.

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The detail

Under Article 3(1) of Federal Decree-Law No. 47 of 2022, Corporate Tax is charged at 0% on the portion of Taxable Income up to an amount fixed by a Cabinet Decision, and at 9% on the excess. The Decree-Law itself does not state the AED figure - that is left to a separate Cabinet Decision issued on the Minister's suggestion.1

What the law says

  • Article 3(1) imposes 0% on taxable income up to a threshold set by Cabinet Decision, and 9% on taxable income exceeding that threshold.1
  • A Qualifying Free Zone Person instead pays 0% on its Qualifying Income and 9% on any other Taxable Income, under Article 3(2).1

What it depends on

  • The 0%/9% split applies to ordinary Taxable Persons; Qualifying Free Zone Persons follow the separate Qualifying Income regime instead.1
  • The precise AED amount of the 0% threshold is set by a Cabinet Decision, not by the Decree-Law itself, so it can change.1

Check before you rely on it

  • Confirm the current AED threshold in the applicable Cabinet Decision, as it is not stated in the Decree-Law text.
  • Check whether you qualify as a Qualifying Free Zone Person, which follows a different 0%/9% test.
Note: The specific AED amount of the 0% threshold is set by a separate Cabinet Decision that is not among the sources provided, so confirm the current figure directly with the FTA or Ministry of Finance publication.
Sources (1) — read the official text
  1. 1Corporate Tax LawArticle 3Law
    Article 3 – Corporate Tax Rate
    Read the article
    Article 3 – Corporate Tax Rate 1. Corporate Tax shall be imposed on the Taxable Income at the following rates: a. 0% (zero percent) on the portion of the Taxable Income not exceeding the amount specified in a decision issued by the Cabinet at the suggestion of the Minister. b. 9% (nine percent) on Taxable Income that exceeds the amount specified in a decision issued by the Cabinet at the suggestion of the Minister. 2. Corporate Tax shall be imposed on a Qualifying Free Zone Person at the following rates: a. 0% (zero percent) on Qualifying Income. b. 9% (nine percent) on Taxable Income that is not Qualifying Income under Article 18 of this Decree-Law and any decision issued by the Cabinet at the suggestion 1 Definition added as per Federal Decree-Law No. 60 of 2023. 2 Definition added as per Federal Decree-Law No. 60 of 2023. Federal Decree-Law No. 47 of 2022 and its amendments – Unofficial translation (as published by the Ministry of Finance) 8 of the Minister in respect thereof. 3. Without prejudice to the provisions of Clauses (1) and (2) of this Article, the Cabinet at the suggestion of the Minister shall issue a decision regulating all cases, provisions, conditions, rules, controls, and procedures for imposing the Top-up Tax on Multinational Enterprises and the exemptions therefrom, so that the total percentage of the effective tax imposed on them is (15%) fifteen percent. 3 Chapter Three – Exempt Person
    Official PDF, pp. 8–9Captured from the FTA website on 9 Sep 2026
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Written by AI from the FTA sources above and checked before display. Not tax advice or official FTA information - confirm with a tax adviser before you act. Full disclaimer

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