UAE Corporate Tax Calculator for Manufacturers
UAE corporate tax applies at 9 percent on taxable income above AED 375,000. Getting from the profit in your ledger to taxable income takes a few adjustments. This calculator walks through them in order and shows the effective rate, which is often much lower than 9 percent for small and mid sized manufacturers.
Your numbers
Net profit per IFRS financial statements before corporate tax.
For example 50 percent of client entertainment, fines and penalties, and any expense not incurred for the business.
For example qualifying dividends and participation gains that meet the participation exemption conditions.
Only losses incurred in tax periods starting on or after 1 June 2023.
Taxable income up to this amount is taxed at 0 percent.
Your results
Simplified estimate for a standard UAE taxable person. It ignores qualifying free zone person rules, transfer pricing adjustments, group relief, interest limitation and the Domestic Minimum Top-up Tax for large multinational groups. Confirm with a registered tax agent.
Corporate tax vs accounting profit
Sweeps Accounting profit before tax from 0 to 6000000, holding your other inputs fixed.
Pull tax schedule data from your ERP
An optional review of how to automate the add-back and loss schedule from GL data.
Optional. The tool and every export work without this. No spam.
How taxable income is built
Start with accounting profit under IFRS. Add back expenses the law does not allow, such as fines and half of entertainment costs. Deduct exempt income that qualifies under the participation exemption. The result is taxable income before losses. Tax losses from periods starting on or after 1 June 2023 can then offset up to 75 percent of that figure. Finally the first AED 375,000 is taxed at 0 percent and the rest at 9 percent.
- Profit + non-deductible add-backs - exempt income
- Loss relief capped at 75 percent of taxable income
- 0 percent band up to the threshold, 9 percent above
Worked example
With AED 3.2 million profit, AED 120,000 add-backs and AED 400,000 losses, taxable income before relief is AED 3.32 million. The loss cap is 75 percent, about AED 2.49 million, so all AED 400,000 of losses are used. Taxable income becomes AED 2.92 million. Tax is 9 percent of the amount above AED 375,000, roughly AED 229,000, an effective rate near 7.2 percent of accounting profit. Change one input at a time to see what each lever is worth.
Data you need from your ERP
The add-back figure comes from expense accounts tagged for entertainment, fines and donations, so a clean chart of accounts and tax codes make this easy. Many plants build the schedule in Excel at year end. If your ERP carries a tax attribute per GL account, the add-back can be a query. The chart sweeps profit so you can see the marginal effect of a stronger or weaker year before budgeting cash tax.
Common mistakes
The most common errors are applying 9 percent to the whole profit instead of the excess over the threshold, forgetting the 75 percent loss cap, and ignoring that losses from before the regime started cannot be used. Free zone entities that qualify for the 0 percent rate on qualifying income need a separate analysis, since this tool assumes the standard regime.
Frequently Asked Questions
What is the UAE corporate tax rate?
The standard rate is 9 percent on taxable income above AED 375,000, with 0 percent on the first AED 375,000. Large multinational groups may also fall under a 15 percent top-up tax, which this calculator does not model.
Can I carry forward tax losses?
Yes, losses from tax periods starting on or after 1 June 2023 can be carried forward indefinitely, but each year they can offset only up to 75 percent of taxable income. The calculator applies that cap and shows the balance carried forward.
Does this apply to free zone companies?
Only to a free zone entity that does not meet qualifying free zone person conditions, or on its non-qualifying income. Qualifying income may be taxed at 0 percent. Check the conditions with a tax adviser before using the standard result.
Is accounting profit the same as taxable income?
No. Taxable income starts from accounting profit but adds back non-deductible items and removes exempt income. The calculator makes those adjustments explicit so you can reconcile them to the ledger.
Netray can help you extract the GL and tax attribute data your tax adviser needs from your ERP, on your own infrastructure. Ask if your year end schedule still takes days.
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