Ajman Free Zone tax system - taxation of United Arab Emirates companies and individuals: VAT, income tax and capital gains

There is no income tax on individuals in the UAE.

The UAE is a federation of seven emirates. There is currently no federal tax on profits/income of companies in the UAE.

However, income tax is imposed by the emirates at their level.

In the emirates where profit tax is imposed, it is only imposed on oil and gas production and processing companies and branches of foreign banks.

Social contributions are payable only to nationals of the UAE and other member states of the Gulf Cooperation Council (GCC).

The contribution rate for UAE nationals is normally 17.5%:

12.5% of the remuneration is paid by the employer and 5% is withheld by the employer from the employee's remuneration.

Higher rates are set in Abu Dhabi: 20% (the employer's contribution is 15%).

The standard rate of VAT is 5%.

There is no tax at source in the UAE.

There is no stamp duty in the UAE.

The annual fee for companies is AED 2,000. The fee is payable at the end of each year of incorporation, as is the registration agent fee.

Municipal tax is collected on rented premises. Generally, the tax base is the annual rental value.

The tax is usually levied on tenants, in some cases both tenant and landlord.

The rate for commercial property is usually 10%.

Registration fees may be charged, particularly for land and real estate transactions.

There are also fees in respect of hotel and tourist businesses.

The UAE has entered into 99 Double Tax Treaties (DTC) and 8 Tax Information Exchange Agreements (TIEA) with the following jurisdictions:

99 DTCs: Algeria, Andorra, Armenia, Austria, Azerbaijan, Bangladesh,Barbados, Belarus, Belize, Belgium, Bosnia and Herzegovina, Bulgaria, Brunei, Burundi, Hungary, UK, Guinea, Germany, Greece, Hong Kong, Georgia, Jersey, Egypt, Venezuela, Vietnam, India, Indonesia, Ireland, Italy, Jordan, Kazakhstan, Kenya, Canada, China, Colombia, Comoros, Kosovo, Kyrgyzstan, Latvia, Lebanon, Libya, Liechtenstein, Lithuania, Luxembourg, Malaysia, Malta, Macedonia, Mauritius, Morocco, Spain, Yemen, Mauritania, Mexico, Mongolia, Mauritius, Mozambique, Netherlands, New Zealand, Nigeria, Pakistan, Panama, Paraguay, Poland, Portugal, Romania, Saint Kitts and Nevis, Senegal, Serbia, Seychelles, Singapore, Slovakia, Slovenia, Sudan, Syria, 8 TIEAs: Argentina, Czech Republic, Ecuador, Equatorial Guinea, Estonia, Ethiopia, Fiji, Finland, France, Montenegro, South Africa, Sri Lanka, Switzerland, Tajikistan, Thailand, Tunisia, Turkey, Turkmenistan, Uganda, Ukraine, Uruguay, Uzbekistan, Japan.

8 TIEAs: Argentina, Colombia, Denmark, Faroe Islands, Finland, Iceland, Norway, Sweden.

In addition, the UAE has signed and ratified the Multilateral Convention to Implement Tax Treaty Related Measures to Prevent Base Erosion and Profit Shifting (MLI). The Multilateral Convention entered into force for the UAE on September 1, 2019.

There are no currency controls in the UAE.