UAE Tax Law

There are no national, personal income taxes in the United Arab Emirates.

The United Arab Emirates (UAE) has a unique tax system in that national taxes are nearly nonexistent. Rather, the federal government has given each district--known as an "emirate"--the authority to establish its own taxes.

Personal Income

There are no national individual income or personal capital gains taxes in the UAE.

National Corporate Taxes

Federal corporate taxes are also scarce in the UAE. The only companies charged corporate income taxes are oil, gas and petrochemical companies and branches of foreign banks.

Municipal Corporate Taxes

The major commerce centers of Abu Dhabi, Dubai and Sharjah all assess taxes on "Every chargeable person who conducts trade or business" in the municipality. As of August, 2010, the rate varies from 10 percent for those with annual profits between 1 to 2 million UAE dirham and 55 percent on profit exceeding 5 million dirham. Total annual profit of less than 1 million is exempt.

Sales Taxes

There is also no national value added tax (VAT) in the UAE. Municipalities, however, assess service taxes of between 5 percent and 10 percent on restaurant dining charges and between 10 percent and 15 percent on hotel room rates.

Property Tax

Residential and commercial tenants are liable for taxes on their annual rent paid. Residential tenants are usually assessed at 5 percent and commercial tenants at 10 percent.

References

• Zayed University: Tamimi and Associates, Taxation Law in the UAE