Free invoice generator and tax tools for the United Arab Emirates

Two federal taxes reach a small UAE business: VAT under Federal Decree-Law No. 8 of 2017 and corporate tax under Federal Decree-Law No. 47 of 2022. Both are run by the Federal Tax Authority (FTA) and share the procedural rules of the Tax Procedures Law (Federal Decree-Law No. 28 of 2022, in force since 1 March 2023, amended by Decree-Law 17 of 2025 with effect from 1 January 2026).

Corporate tax registration has its own deadlines. Under FTA Decision No. 3 of 2024 (effective 1 March 2024), a company incorporated on or after that date, including a free-zone company, applies within three months of incorporation. A natural person running a business registers by 31 March of the following year once turnover in a calendar year exceeds the threshold in the tax legislation.

On payroll, social security through the General Pension and Social Security Authority (GPSSA) covers UAE nationals under Federal Law No. 7 of 1999. The most recent change to penalties is Cabinet Decision No. 129 of 2025, effective 14 April 2026, which amended the VAT and tax-procedure penalty tables.

Small Business Relief lets a resident company elect to be treated as having no taxable income for a tax period (Article 21 of the Corporate Tax Law). Under Ministerial Decision No. 73 of 2023, revenue in the period and in all earlier periods must not exceed AED 3,000,000, and the threshold applies to tax periods starting on or after 1 June 2023 and ending on or before 31 December 2026. Qualifying Free Zone Persons and members of multinational enterprise groups cannot elect. Revenue is measured under the accounting standards accepted in the UAE. An election also has a cost: tax losses incurred in an election year cannot be carried forward. A business that exceeds the threshold in any period can no longer elect.