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Individuals who conduct a Business or Business Activity in the UAE can be subject to Corporate Tax where their total Turnover (gross business income before expenses) from those activities exceeds AED 1 million in a Gregorian calendar year.
Consultants and other self-employed individuals carrying on business activities in the UAE should assess whether their annual Turnover exceeds AED 1 million.
This can include social media influencers, freelancers and retired individuals who independently carry on a Business or Business Activity in the UAE.
The FTA’s guidance explains how Corporate Tax applies to natural persons, including sole proprietors, freelancers and other individuals carrying on business activities in the UAE.
For example, if a self-employed consultant earns AED 1.2 million of Turnover from consultancy services in a calendar year, the AED 1 million threshold is exceeded even if the net profit after deductible expenses is lower.
The AED 1 million amount is a Turnover threshold for determining whether a natural person’s Business or Business Activity is within the Corporate Tax rules; it is not a tax-free band. Once within scope, Corporate Tax is generally 0% on the first AED 375,000 of Taxable Income (income after the applicable tax adjustments) and 9% on the portion exceeding AED 375,000.
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A resident natural person whose total Turnover from Business or Business Activities in the UAE exceeds AED 1 million during 2026 must generally submit the Corporate Tax registration application by 31 March 2027. A non-resident natural person meeting the UAE Permanent Establishment conditions (for example, a qualifying fixed place of business in the UAE) has a different registration timeline.
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What are the 2026 Corporate Tax Deadlines for Individuals?
For a resident natural person whose Business or Business Activity Turnover exceeds AED 1 million during 2026, the UAE Corporate Tax registration application is generally due by 31 March 2027. The natural person’s Tax Period is the Gregorian calendar year, so the 2026 Corporate Tax Return and any Corporate Tax payable are generally due by 30 September 2027. If the person was already registered from an earlier year, a new Corporate Tax registration is not required for each new business activity; the existing Tax Registration Number is used.
Small Business Relief
A resident natural person who is within scope of Corporate Tax may be able to elect for Small Business Relief. Revenue (gross business income for the Tax Period) must not exceed AED 3 million in the relevant Tax Period and in all previous Tax Periods to which the relief conditions apply, subject to the other requirements. Following Ministerial Decision No. 131 of 2026, the AED 3 million threshold continues to apply to eligible Tax Periods ending on or before 31 December 2029. An eligible person must still register and file the required Corporate Tax Return in the UAE.
Income Not Treated as Business Income for Natural Persons
Wage income (salary and employment benefits), Personal Investment Income (qualifying personal investments not conducted through or requiring a Licence and not treated as a commercial business), and qualifying Real Estate Investment Income are not treated as Business or Business Activity income for this natural-person Corporate Tax test and are not included in the AED 1 million Turnover threshold.
Who Falls Under Corporate Tax?
- A natural person is subject to Corporate Tax on Business or Business Activities conducted in the UAE where total Turnover from those activities exceeds AED 1 million in a Gregorian calendar year.
- Employment income is Wage and is outside the natural-person business test. Director fees and similar board remuneration will also generally not be treated as a Business or Business Activity, although the facts should be assessed case by case.
- Freelancers and other individuals carrying on Business or Business Activities in the UAE can be within scope once the AED 1 million Turnover threshold is exceeded. Different rules can apply where a natural person is treated as non-resident under an applicable Double Taxation Agreement and has a UAE Permanent Establishment
- A natural person subject to Corporate Tax must keep records and documents supporting the Tax Return and Taxable Income for seven years after the end of the relevant Tax Period.
So, Who is Required to Register for UAE Corporate Tax?
A natural person who has not previously become subject to Corporate Tax generally does not need to register where total Turnover from Business or Business Activities conducted in the UAE does not exceed AED 1 million in the calendar year. However, a person already registered after exceeding the threshold in an earlier year generally remains registered and must file the required return unless the Business or Business Activity has ceased and the deregistration requirements are met.
“The turnover may encompass ‘in-kind’ payments valued at market value.” This means that if an influencer receives a complimentary stay at a luxury hotel instead of direct payment, it will still be considered part of the turnover for the year.
Sole Proprietors
For Corporate Tax purposes, a sole proprietorship and its owner are treated as one and the same person. The natural person who conducts the business, rather than the sole proprietorship as a separate entity, is the person subject to Corporate Tax.
Unincorporated Partnerships
Generally, each partner in an Unincorporated Partnership (a partnership that is normally treated as transparent for Corporate Tax) is treated separately for Corporate Tax purposes. A natural-person partner includes their distributive share of partnership income when assessing the AED 1 million Turnover threshold.
However, partners can formally request the FTA to treat the ‘unincorporated partnership’ as a ‘taxable person.’ If the FTA approves the application, the income will be taxed at the level of the unincorporated partnership rather than at the level of the individual partners.
Real Estate Investment Income
Real Estate Investment Income (income from selling, leasing, sub-leasing or renting UAE land or property) is not treated as a Business or Business Activity for a natural person where the activity is neither conducted through, nor required to be conducted through, a Licence from a Licensing Authority.
Income From Outside the UAE
Foreign-source income can be relevant where it relates to a Business or Business Activity conducted in the UAE. The FTA guide gives an example of a UAE physiotherapy business earning fees from treatment sessions in other Gulf countries.
Calculation of Turnover and Business Activities
When calculating Turnover, income from outside the UAE should be included where it relates to the Business or Business Activity conducted in the UAE. In the FTA’s physiotherapist example, fees from Gulf treatment sessions linked to the UAE practice are included, while income from a separate foreign clinic is not.
Earning a Wage and Running a Separate Business
An individual may earn Wage income from employment and separately conduct a Business or Business Activity. Wage income is not included in the AED 1 million Turnover test. Only Turnover from the relevant Business or Business Activities is counted. For example, salary under an employment contract is excluded, while freelance or consultancy Turnover is counted.
Tax Deduction on Salary?
A sole proprietor cannot deduct an amount withdrawn from their own business merely by recording it as salary. For Corporate Tax purposes, the individual and the sole proprietorship are the same person, and amounts withdrawn by the natural person from the Business are not deductible.
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Last Reviewed on 11th September, 2026
This page sets out our understanding of corporate tax based on the legislation and guidance in force at the date of last review. The position may change, and the application to a particular set of facts may require further analysis. Nothing on this page constitutes professional, legal or tax advice. Beaufort Associates accepts no liability for action taken or not taken in reliance on this page. Please contact us for advice tailored to your circumstances.
Sources
Primary sources referenced on this page:
- Federal Decree-Law No. 47 of 2022 on the Taxation of Corporations and Businesses, as amended
- Cabinet Decision No. 49 of 2023 Specifying the Categories of Businesses or Business Activities Conducted by a Resident or Non-Resident Natural Person that are Subject to Corporate Tax
- Cabinet Decision No. 116 of 2022 on the Taxable Income Threshold
- FTA Corporate Tax Guide | Taxation of Natural Persons under the Corporate Tax Law | CTGTNP1
- FTA Decision No. 3 of 2024 on the Timeline Specified for Registration of Taxable Persons for Corporate Tax
- FTA Corporate Tax Guide | Small Business Relief | CTGSBR1
- Ministerial Decision No. 131 of 2026 amending Ministerial Decision No. 73 of 2023 on Small Business Relief
- FTA Corporate Tax Registration service page
We have referenced the legislation in force as at the last review date. The UAE tax framework is evolving; later changes may affect the position. Speak with us for advice on your specific circumstances.
