GSL / International Taxation / Tax systems of foreign countries / United Arab Emirates: Hamriyah Free Zone

Hamriyah Free Zone tax system: audit, reporting and optimization of taxation of United Arab Emirates companies and individuals: VAT, income tax and capital gains

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Taxes of UAE

No
Сorporate tax
No
Capital gains tax
5%
VAT
No
Withholding tax
No
Exchange control

info
Basic taxes (briefly)

Personal tax
No
Corporate tax (in detail)
There is currently no federal corporate income tax in the UAE. However, the emirates introduce income tax at their own level. In the emirates, where income tax has been introduced, it is levied only on companies engaged in the extraction and processing of oil and gas and branches of foreign banks.
Capital gains tax. Details
There is no capital gains tax in the UAE
VAT. Details
The standard VAT rate is 5%.
Other taxes
real property tax, municipal duties
Government fee
Stamp duty
No

Taxation of individuals

There is no income tax on individuals in the UAE.

Income tax

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

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%).

VAT

The standard rate of VAT is 5%.

Withholding tax

There is no tax at source in the UAE.

Other taxes

There is no stamp duty in the UAE.

Annual fee

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.

Other taxes and fees

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.

International tax treaties

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.

Currency controls

There are no currency controls in the UAE.

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