One of Dubai’s major advantages is the absence of personal income tax. Residents are not subject to taxation on salaries, investments, or other sources of personal income.
Additionally, there is no wealth tax or inheritance tax, offering a particularly favorable tax framework for individuals.
Historically, Dubai did not impose corporate tax, except on specific industries such as oil and gas and foreign banks.
However, since June 1, 2023, a federal corporate tax has been introduced in the UAE, including Dubai.
Free Zones in Dubai continue to offer tax incentives, including periods of corporate tax exemption, subject to meeting certain conditions.
Introduced in January 2018, VAT in the UAE is set at a standard rate of 5%.
VAT applies to most goods and services, with some exceptions such as:
Businesses with an annual turnover exceeding a certain threshold are required to register for VAT and collect the tax on their sales.
To benefit from Dubai’s favorable tax environment, it is important to understand the criteria for tax residency.
An individual is considered a Expat tax resident if they meet any of the following criteria:
Therefore, to be considered a tax resident of Dubai, it is essential to effectively transfer your home and center of economic interests to the UAE.
It is recommended to keep tangible evidence of this transfer, such as:
In conclusion, Dubai offers an attractive tax environment for expatriates, with an absence of personal income tax and competitive corporate tax rates.
However, it is crucial to fully understand the tax implications, both in the United Arab Emirates and your home country, and to take the necessary steps to clearly establish one’s tax residence in Dubai.
Whether you are launching in the UAE, expanding internationally, or structuring long-term operations, EXILLIUM provides the execution and advisory layer to move confidently — from strategy to implementation.
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