Under what circumstances can a company in the UAE enjoy tax exemption policies?

Time: 2026-08-14

Author: Zhuo Xin

Source: Zhuo Xin

IntroductionFirst, for each tax period ending on or before December 31, 2026, small and medium-sized enterprises with an annual income not exceeding 3 million dirhams can apply for a small business tax relief policy and be exempt from paying taxes. Secondly, companies registered in the UAE's free trade zones, which do not operate in the mainland UAE and comply with the requirements of the free zone regulatory authorities and submit proper declarations, can enjoy a 0% corporate tax benefit. Additionally, qualifying holding companies can exempt passive income such as dividends and capital gains from corporate tax. Government entities, sovereign funds, and public benefit organizations are also tax-exempt after obtaining approval from the Federal Tax Authority or the cabinet.

First, for each tax period ending on or before December 31, 2026, small and medium-sized enterprises with an annual income not exceeding 3 million dirhams can apply for a small business tax relief policy and be exempt from paying taxes. Secondly, companies registered in the UAE's free trade zones, which do not operate in the mainland UAE and comply with the requirements of the free zone regulatory authorities and submit proper declarations, can enjoy a 0% corporate tax benefit. Additionally, qualifying holding companies can exempt passive income such as dividends and capital gains from corporate tax. Government entities, sovereign funds, and public benefit organizations are also tax-exempt after obtaining approval from the Federal Tax Authority or the cabinet.

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