What is the withholding tax rate in the UAE?

Time: 2026-08-14

Author: Zhuo Xin

Source: Zhuo Xin

IntroductionThe withholding tax rate in the UAE is typically 5% to 10%, but the specific rate depends on the nature of the service and the applicable double taxation agreement. Below is a detailed explanation of the UAE's withholding tax rate: 1. Standard rate: In the absence of specific exemptions or double taxation agreements, the UAE usually imposes a withholding tax of 5% to 10% on certain services and interest income provided to non-residents. 2. Impact of double taxation agreements: The UAE has signed double taxation agreements with multiple countries, which may stipulate different withholding tax rates or exemptions. Therefore, when paying non-resident income, businesses should first check whether an applicable double taxation agreement exists and determine the withholding tax rate accordingly. 3. Exemptions under specific circumstances: In certain cases, such as payments to qualifying free zone companies as 'qualified income,' a preferential corporate tax rate of 0% may apply, exempting the payment from withholding tax. Additionally, certain types of income may be exempt from withholding tax based on the specific terms of the double taxation agreement. In summary, the UAE's withholding tax rate is not fixed but is determined based on the nature of the service, double taxation agreements, and exemptions under specific conditions.

The withholding tax rate in the UAE is typically 5% to 10%, but the specific rate depends on the nature of the service and the applicable double taxation agreement. Below is a detailed explanation of the UAE's withholding tax rate:

1. Standard rate: In the absence of specific exemptions or double taxation agreements, the UAE usually imposes a withholding tax of 5% to 10% on certain services and interest income provided to non-residents.

2. Impact of double taxation agreements: The UAE has signed double taxation agreements with multiple countries, which may stipulate different withholding tax rates or exemptions. Therefore, when paying non-resident income, businesses should first check whether an applicable double taxation agreement exists and determine the withholding tax rate accordingly.

3. Exemptions under specific circumstances: In certain cases, such as payments to qualifying free zone companies as 'qualified income,' a preferential corporate tax rate of 0% may apply, exempting the payment from withholding tax. Additionally, certain types of income may be exempt from withholding tax based on the specific terms of the double taxation agreement.

In summary, the UAE's withholding tax rate is not fixed but is determined based on the nature of the service, double taxation agreements, and exemptions under specific conditions.

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UAE