It has just been announced by the UAE Finance Ministry that Corporate taxation will be introduced in the UAE, including Dubai, RAK and the other Emirates, at the rate of 9% with a tax-free exemption of AED 375,000 – c.$100,000.
Details are still sparse, but it seems that:
- Local companies will be taxed at 9%.
- Free Zone Companies will only be taxed insofar as they deal in the local economy with non-UAE earnings remaining exempt.
- International Companies (offshore companies) have not been mentioned, and it may be presumed that they will be treated in the same way as Free Zone companies. We are seeking confirmation of this.
Interestingly, this follows the requirement for UAE local companies to have a ‘local’ shareholder being abolished from mid-2020. It could be that offshore/international companies might be combined with local companies in the coming months.