The Allsopp & Allsopp Dubai Property Market Report for Q3 2024 is now availableRead the report
As we close off the first half of 2024, Dubai’s property market has shown impressive growth across all residential sectors with no signs of slowing down.
So, if you’ve lived in Dubai or in the UAE - you might know that tax is an extremely foreign word to us but If you’ve been in Dubai over the last year, or have been keeping tabs on the news, you might have heard that corporate tax has been introduced in the UAE and was enforced starting June 1st 2023.
And a lot of folks around town have stood up with questions toward corporate tax, such as whether it applies to personal income, or not?
And with Dubai’s new update on corporate tax - we’re here to break it down for you and answer all those questions!
People conducting business or business activities will be subject to corporate tax and registration requirements only if their combined turnover exceeds AED 1 million annually, the Ministry of Finance said in an update.
"For example, if an individual who is a UAE Resident operates an online business and the combined annual turnover from this business exceeds AED 1 million, under the new decision, the UAE Resident business income from the online business would be subject to Corporate Tax," the Ministry of Finance clarified
If you’ve been wondering whether your personal income would be affected by the new corporate tax, then relax because it won’t be. Corporate tax is only applicable to corporate company turnover and not income.
Whereas, for rental incomes - Real estate income earned from UAE property owned by foreign or UAE resident individuals, either directly or through a trust, foundation or other form that is treated as fiscally transparent for UAE corporate tax purposes, would generally not be subject to corporate tax provided it is not a licensed business activity.
Although, corporate tax will be applicable for foreign investors, foreign companies and other non-resident juridical people will be subject to UAE corporate tax on an income derived from real estate and other immovable property located in the UAE and will be required to register for EmaraTax in the UAE for corporate tax purposes.
Got more questions on corporate tax?
We’ve got the whole breakdown on corporate tax and if you have any further queries on rental incomes, you can contact our sales and lettings experts!