Small Business Relief and free zones
I am a freelancer with a personal licence. Am I subject to Corporate Tax?
Usually safe if you keep the documents
The basic rule
An individual has to pay Corporate Tax (official term: is a Taxable Person) only when the total income from their business activities in the UAE goes over 1,000,000 AED in a calendar year. Salary from a job, personal investment income and qualifying property rental income do not count.
When it is different
- Above AED 1,000,000: register by 31 March of the following year and file like other taxable persons; Small Business Relief may then be available.
- Turnover is gross business turnover (before expenses), across all your licensed and unlicensed business activities.
- A company (FZ-LLC, LLC) you own is a separate taxable person from day one, whatever its revenue.
- VAT has its own separate thresholds.
Documents to keep
- Record of turnover per calendar year
- Licence or freelance permit
How safe is it?
Usually safe if you keep the documents Low if you track turnover each year.
When to ask a professional
Ask if you are close to AED 1,000,000 or have several activities. Who can confirm it for your own case: an FTA-registered tax agent (a tax professional approved by the UAE tax authority), or the optional year-end review in SoloBooks.
Check it with the free calculator: Small Business Relief calculator →
Sources
- Federal Decree-Law No. 47 of 2022 on the Taxation of Corporations and Businesses (consolidated, unofficial English translation) — Art. 11(3)(c) and 11(6)
- Cabinet Decision No. 49 of 2023 on natural persons subject to Corporate Tax — Art. 2
- FTA Decision No. 3 of 2024 on the Corporate Tax registration timeline — Art. 5
- FTA Corporate Tax Guide: Taxation of Natural Persons (CTGNP1) — Whole guide
General information, not tax advice. Your situation may differ.
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Related questions
- Am I eligible for Small Business Relief (no Corporate Tax for small businesses)?
- What are the traps with Small Business Relief?
- I have a free zone company. Do I pay 0% or use Small Business Relief?
- What rate does my company pay if it does not use Small Business Relief?
- Can I keep my records on a cash basis (when money comes in or goes out) instead of accruals?