Dubai Tax in 2026: 0% Personally, 9% for Companies, Free Zone Myth
What a business owner pays in Dubai in 2026: no personal income tax, 9% corporate tax above AED 375,000, who actually gets the free zone 0%, and tax residency in 90 days.
A business owner who lives in Dubai pays no personal income tax. No tax on salary, none on dividends, no capital gains tax, no inheritance tax, no wealth tax, and no social security contributions unless you are a Gulf national. Whatever you take out of your company, you keep, and if you sell the business one day the UAE does not tax the gain.
The company is the part that changed. Since 2023 a UAE company pays 9% corporate tax on profit above AED 375,000, about $102,000, and a free zone licence does not change that for most businesses. What you end up paying comes down to what your business sells, who it sells to, how many days you spend where, and what the country you are leaving does about it.
- Personal income tax
- 0%
- Corporate tax
- 9% above AED 375,000
- Free zone 0%
- Only for listed activities
- VAT
- 5%, registration at AED 375,000
- Tax residency
- 90 days with a visa and a home, or 183 days
- Golden visa
- AED 2,000,000, 10 years
- Ordinary visa
- Cancelled after 180 days away
- Setting up
- About 2 to 4 weeks
Dubai in brief
The UAE is a federation of 7 emirates on the Persian Gulf. Abu Dhabi is the capital and Dubai is one of the emirates, with its own government, but tax and immigration are mostly federal, so nearly all of this applies to the whole country.
About 11 and a half million people live there and roughly 88% of them are foreign. Arabic is the official language and business runs in English, so your accountant, your bank and your lawyer all work with you in English. The dirham has been pegged to the US dollar at 3.6725 since 1997, so if you think in dollars, your money does not move.
October to April is excellent. July and August are hard: around 45 degrees with humidity near 90%, and life moves indoors for about 4 months. Plenty of people leave for the summer. The business community sits in DIFC, Business Bay and Downtown, and families tend to live in Dubai Hills, Arabian Ranches or on the Palm.
Day-to-day safety is one of the reasons people move, and street crime is rare. 2026 added a caveat: the war that started in February brought Iranian missile and drone attacks on the UAE, and many residents left during them. The ceasefire since April has largely held and flights are running normally, but the UK's travel advice still warns of possible escalation and airspace closing at short notice. Worth weighing rather than assuming the pre-2026 picture.
Who can live there
Unless you are from a Gulf country, you need a UAE residence visa to live in Dubai, and everything here is a residence permit rather than a route to a passport. Citizenship is by nomination only.
Through your own company
The normal route for a business owner. You set up the company and the company sponsors your visa, as an employee or as an investor. That usually runs 2 years at a time, you can sponsor your spouse and children on it, and there is no minimum investment.
The golden visa
AED 2,000,000, about $545,000, into a qualifying investment or into property gets you 10 years, renewable, with no sponsor and your family included. There are also golden visa routes for entrepreneurs, senior executives, specialists and top graduates, judged on what you do rather than on what you invest. On the property route the visa fees themselves come to about AED 9,885, roughly $2,690, and that covers the full 10 years; family visas cost extra, and none of it includes the property.
The green visa
5 years, self-sponsored, so it is not tied to an employer. It is for skilled professionals, freelancers and investors.
When you are actually tax resident
Having a visa and being tax resident are different things. Under the rules in force since March 2023, any one of 3 tests makes you UAE tax resident:
- Your usual home and the centre of your personal and financial interests are in the UAE.
- You spend 183 days there in any 12 months.
- You spend 90 days there in any 12 months, hold a valid residence visa, and have either a permanent home in the UAE or a business or job there.
The third is the one most people use, and 90 days really can be enough. It has to be real, though: an apartment you own or rent rather than an address, and a visa that stays valid.
The other 275 days are the part that gets missed. They happen somewhere, and that somewhere has its own rules on when you become resident.
What you pay personally
Nothing. There is no personal income tax in the UAE: no tax on salary, no tax on dividends, no capital gains tax, no inheritance tax and no wealth tax. If you are not a Gulf national there are no social security contributions either.
In practice that means whatever your company distributes to you arrives whole, and the tax question moves entirely to the company.
What the company pays
Since financial years beginning on or after 1 June 2023, UAE companies pay 9% corporate tax on profit above AED 375,000, about $102,000. Profit at or below that is taxed at 0%, which is a small allowance inside the normal rules rather than a special regime.
Take a company with AED 10,000,000 of profit, about $2.72 million. It pays 9% on the AED 9,625,000 above the threshold, so AED 866,250 — about 8.7% of the whole profit. What is left can be distributed to you with nothing further to pay.
Small business relief sits below that: if revenue is AED 3,000,000 or less, a company can elect to be treated as having no taxable income at all. It was extended in 2026 and now runs to tax periods ending on or before 31 December 2029. It is measured on revenue rather than profit, so most businesses at the level this guide is written for are already past it, and a company claiming the free zone 0% cannot elect it.
Every company registers for corporate tax and files a return within 9 months of its year end, including a company that pays nothing.
The 0% free zone rate, and who gets it
A free zone licence does not make a company tax free. The 0% applies to the qualifying income of a qualifying free zone person, and qualifying income is defined narrowly: income from other free zone companies that are the beneficial recipients, income from outside the free zone only where it comes from a listed qualifying activity, income from patents and copyrighted software, and anything else only within a small de minimis allowance.
The qualifying activities are a closed list. Manufacturing and processing of goods, trading in qualifying commodities, holding shares and securities for investment, owning and operating ships, reinsurance, fund management, wealth and investment management, headquarter, treasury and financing services to related parties, aircraft financing and leasing, distribution from a designated zone, logistics, and whatever is ancillary to those.
What is not on the list matters more. Consulting, agencies, marketing, coaching, information products, e-commerce and most software subscriptions do not appear anywhere in it. Sell those to a customer outside the free zone and the income is taxed at 9%, free zone licence or not. Selling to individuals rather than businesses is an excluded activity in its own right for most activities, whatever else is true.
So the businesses that do reach 0% are a particular set: family offices and investment companies, groups whose UAE entity serves the rest of the group, commodity traders, owners of patents or copyrighted software, and companies selling to other free zone companies. Some of our clients land there. Most pay 9%.
Whether a business can be arranged to sit inside those rules, and whether that is worth doing, depends entirely on what it sells and to whom. It is the first thing we work through with clients who arrive expecting 0%.
Which free zone, and what about the mainland
There are more than 40 free zones in the UAE and they are not interchangeable. Broadly they fall into 3 groups.
| Compared | Budget zones | Established Dubai zones | DIFC and ADGM |
|---|---|---|---|
| Examples | Sharjah Media City, IFZA, Meydan, RAKEZ, Ajman | DMCC, JAFZA, Dubai Internet City | DIFC, ADGM |
| Licence cost a year | Low to mid 4 figures | High 4 into low 5 figures | Higher again |
| Banking | Banks apply more diligence | Usually easier | Built for regulated firms |
| Legal system | Federal law | Federal law | English common law, own courts and regulator |
| Suits | Small teams, little office space | Companies that want weight behind the licence | Funds, brokerages, anything holding client money |
DMCC is the largest of them by number of companies. DIFC and ADGM are a different animal: if you run a fund or a brokerage, or hold client money, they are usually the answer, and for an ordinary trading or services business they are overkill.
What decides the zone for a particular company is whether it licenses your activity at all, how many visas you need and how much office space that requires, and which banks you want to work with. The cheapest zone is often not the right one, which is why UAE freezone company formation starts with the activity rather than the price list.
The other option is the mainland. A mainland company can trade directly inside the UAE, so it is the right structure for a restaurant, a shop or anything serving the local market. Foreigners have been able to own mainland companies outright since June 2021 in most activities, with a short list of strategic sectors still restricted. For a business selling internationally, it is usually not the one you need.
Crypto and investments
For an individual holding and investing, there is no tax. No capital gains tax means selling crypto you held as an investment is not taxed, however much it has gone up.
A commercial trading business is different and falls under the corporate tax rules above. Whether what you do is personal investing or a business depends on how you actually operate, including whether the activity needs a licence. Trading often, or making it your main income, does not settle the question on its own.
Banking
Opening accounts in Dubai used to be slow. Digital banks and money institutions have changed that: a working personal and business account within days is normal now, and for many businesses that is enough to start operating.
The traditional banks have got easier too. With proper financials you can open with a major UAE bank without extreme requirements, though there is sometimes a minimum deposit, and what your business does and where you are from both matter.
The weak spot is international payments. Sending money abroad from the UAE usually costs more per transaction, and more on conversion, than from the US or Europe. A lot of clients keep their day-to-day personal banking, and some of their company banking, outside the country. Living in Dubai and banking elsewhere is a normal setup, and often the better one.
The UAE is not a place to hide money. It has been exchanging bank account information automatically under the Common Reporting Standard since 2018, now with more than 100 jurisdictions, and it came off the international money laundering grey list in February 2024.
VAT
VAT is 5% and has been since 2018. A company has to register once its taxable sales pass AED 375,000 a year, and can register voluntarily from AED 187,500. The threshold is the same figure as the corporate tax band, but it is a different tax on a different base: revenue, not profit.
Services sold to business customers outside the UAE are zero rated. If your clients are abroad you charge them nothing, while still registering, filing and reclaiming the VAT you pay on your own costs. For most international businesses VAT is paperwork rather than a cost.
What you file, what it costs, and how long it takes
Before 2023 a small UAE company had almost nothing to file. That is over. You need proper accounts, corporate tax registration and an annual return, VAT registration and returns through the year, and audited accounts if you want the free zone 0% or if your zone requires them anyway. Electronic invoicing is being phased in as well: voluntary from July 2026, then mandatory from January 2027 for businesses with revenue of AED 50,000,000 or more, with the rest of VAT-registered businesses following later that year.
| Item | Cost |
|---|---|
| Licence in a budget free zoneRenewal costs about the same as setting up | Low to mid 4 figures a year |
| Licence in an established Dubai zoneMore substance expected, banking usually easier | High 4 into low 5 figures a year |
| Audited accountsRequired for the 0% rate at any size, and by several zones | On top |
| Bookkeeping and filingsCorporate tax return yearly, VAT returns through the year | On top |
Setting up itself is fast.
- 01
Pick the zone and the activities
The licence has to cover what you actually do, and the number of visas you want decides the office space you need. - 02
Licence and establishment card
The company itself is formed in a day, sometimes a few. The establishment card is what lets it sponsor visas. - 03
Entry permit, medical and Emirates ID
You have to be in the country for this part. A medical test and biometrics, then the residence visa is stamped and the Emirates ID issued. - 04
Bank account
Digital banks in days. A traditional UAE bank takes longer and asks for more, and which bank fits depends on the business. - 05
Tax registrations
Corporate tax registration is compulsory whatever you pay. VAT registration follows once taxable sales pass AED 375,000.
From deciding to having everything in place is usually 2 to 4 weeks, which is fast compared with most countries.
Questions
Is Dubai really tax free?
For you personally, yes: no income tax, no capital gains tax, no inheritance or wealth tax, and no social security if you are not a Gulf national. Your company is not tax free. Since 2023 it pays 9% corporate tax on profit above AED 375,000, about $102,000.
Do free zone companies pay 0% corporate tax?
Only on qualifying income, which is a narrow list: sales to other free zone companies, listed activities such as manufacturing, commodity trading, fund and wealth management, holding companies and group treasury, and income from patents and copyrighted software. Consulting, agencies, e-commerce, coaching, information products and most software subscriptions are not on the list and are taxed at 9%.
How many days do I have to spend in Dubai to be tax resident?
90 days in any 12 months is enough if you also hold a valid residence visa and have a permanent home or a business there. Otherwise it is 183 days, or having your main home and the centre of your personal and financial interests in the UAE.
Can I keep a UAE visa if I mostly live somewhere else?
On an ordinary company-sponsored visa, no: more than 180 continuous days outside the UAE cancels it automatically, though a trip back resets the count. Golden and green visas are exempt from that rule.
Is crypto taxed in Dubai?
Not for an individual investing their own money. There is no capital gains tax, so selling crypto you held as an investment is not taxed. Running a trading business is different and falls under corporate tax.
Does my company still have to file if it pays no tax?
Yes. Corporate tax registration is compulsory for every company and the return is due within 9 months of the year end. If you claim the free zone 0% you also need audited financial statements, whatever the size of the company.
How long does it take to set up a company and get residency?
The company and licence take a day to a few days. Adding the establishment card, entry permit, medical, Emirates ID and a bank account, the whole thing is usually 2 to 4 weeks, and part of it has to be done in person.
Can I get a UAE passport?
Realistically no. Naturalisation is by nomination only, so everything available to a business owner is a renewable residence permit rather than a path to citizenship.
Who Dubai is right for
Dubai suits a business owner who can move, wants to be around other founders, and whose company either pays 9% without argument or fits one of the 0% categories. You keep everything you take out personally, setting up is quick, and the place works.
What it does not do is fix the country you are leaving. Exit taxes, controlled foreign company rules and the question of where your company is really managed all land before the Dubai part starts, and they are specific to you. If you are running a business at 7, 8 or 9 figures, or you are a high-net-worth individual, book a consultation and we will go through your situation and tell you what we would do.
