New: UAE company formation with Filing HQ — 9% corporate tax, 0% personal income tax, and how it compares with the UK
Filing HQ now helps you set up in the UAE — company formation in a free zone or on the mainland, residence visas, bank account guidance, corporate tax registration and payroll. Here's how UAE tax compares with the UK, side by side.
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Filing HQ now helps you set up in the United Arab Emirates. You can form a company in a free zone or on the mainland in any of the seven emirates. We can also arrange residence visas, guide you through opening a bank account, register the company for corporate tax and run its payroll. You deal with Filing HQ throughout, and our licensed UAE partners handle the authorities on the ground.
The reason most founders ask us about the UAE is tax. The UAE charges 9% corporate tax, and nothing on the first AED 375,000 of taxable income. It has no personal income tax. UK Corporation Tax runs from 19% to 25%, and UK income tax goes up to 45%. Below we set the two systems side by side. We also explain the part many "move to Dubai" articles leave out: when a UAE company actually changes your tax bill.
Thinking about a UAE company?
Tell us what you need and which free zones or emirates you're considering. We'll recommend a setup and give you a clear quote.
What's new: UAE services at Filing HQ
- Company formation — free zone or mainland. We help you choose the jurisdiction and manage the licence application.
- Residence visas — investor, partner and employee visas, from entry permit to Emirates ID.
- Bank account guidance — we help you choose a bank, prepare your documents and get an introduction. The bank makes the final decision.
- Corporate tax registration — with the Federal Tax Authority, for mainland and free zone companies.
- Payroll — fully managed, or register your interest in self-serve software.
UAE costs depend on the free zone or emirate, your business activity and the number of visas you need, so we quote for each setup rather than publish one price.
UAE corporate tax: 9%, with a 0% band
The UAE introduced a federal corporate tax for financial years starting on or after 1 June 2023. There are two rates:
- 0% on taxable income up to AED 375,000
- 9% on taxable income above AED 375,000
The 0% band applies to every company, however much it earns. A company with taxable income of AED 1,000,000 pays 9% on the AED 625,000 above the band. That's AED 56,250, an effective rate of about 5.6%.
UK Corporation Tax is 19% on profits of £50,000 or less and 25% on profits over £250,000. Between those two, marginal relief tapers the rate up towards 25%. Once profits pass £250,000, the whole profit is taxed at 25%, including the first £50,000.
Free zone companies: 0% on qualifying income
A free zone company that meets the conditions to be a Qualifying Free Zone Person pays 0% on its "Qualifying Income". Other income is taxed at 9%, and the AED 375,000 0% band does not apply to it. Among the conditions, non-qualifying income must stay within a de minimis limit. Free zone companies still have to register for corporate tax, including those that expect to pay 0%. Whether your income counts as qualifying depends on your activity and your customers, so check it before you choose a free zone.
0% personal income tax
The UAE does not levy income tax on individuals. That covers salaries and the dividends you pay yourself from your company. In the UK in 2026/27, income above the £12,570 personal allowance is taxed at 20%, 40% or 45%. Dividends above the £500 allowance are taxed at 10.75%, 35.75% or 39.35%. Salaries also attract National Insurance: 8% for the employee and 15% for the employer.
UK vs UAE: side by side
UK figures are for England, Wales and Northern Ireland in the 2026/27 tax year (Corporation Tax: financial year from 1 April 2023). Scotland has its own income tax bands.
| United Kingdom | United Arab Emirates | |
|---|---|---|
| Corporate tax | 19% on profits up to £50,000; 25% over £250,000; marginal relief in between | 0% up to AED 375,000; 9% above |
| Free zone companies | No equivalent | 0% on qualifying income for a Qualifying Free Zone Person; 9% on other income |
| Personal income tax | 0% up to £12,570, then 20%, 40% and 45% | None on individuals |
| Tax on dividends | 10.75%, 35.75% or 39.35% above a £500 allowance | None on individuals |
| VAT standard rate | 20% | 5% |
| VAT registration threshold | £90,000 taxable turnover | AED 375,000 taxable supplies and imports |
| Where you register the company | Companies House | The free zone's authority, or the emirate's economic department for the mainland |
| Corporate tax registration | HMRC, within 3 months of starting business activity | Federal Tax Authority — free zone companies included |
Sources: GOV.UK (Corporation Tax rates, Income Tax rates); UAE Federal Tax Authority (VAT registration, Free Zone Person bulletin); u.ae on personal taxation; UAE Ministry of Finance on the corporate tax start date. Figures checked 30 September 2026.
Free zone or mainland? Tell us about your business and we'll recommend the right setup.
Important: the lower rates only help if the tax actually falls in the UAE
Forming a UAE company does not, on its own, take you or your profits out of UK tax. Three points decide whether the UAE rates apply to you:
- Your personal tax residence. If you are UK tax resident under the statutory residence test, you are taxed in the UK on your worldwide income. That includes salary and dividends from a UAE company. The UAE's 0% personal income tax helps people who genuinely live there.
- Where the company is run from. A foreign company whose central management and control is in the UK can be UK tax resident. If you make its key decisions from the UK, it can owe UK Corporation Tax despite being incorporated in the UAE.
- Anti-avoidance rules. The UK's controlled foreign company rules and transfer pricing rules can bring profits that were artificially diverted offshore back into UK tax.
The UAE works best for founders who are relocating, businesses with real operations and customers in the region, and groups adding a genuine Middle East presence. If you'll stay UK resident, take UK tax advice before you rely on a UAE structure — our accounting partners can help.
Free zone or mainland?
A free zone company is licensed by that zone's own authority and runs under its rules. The popular choices include DMCC, IFZA, Meydan and JAFZA in Dubai, ADGM and KEZAD in Abu Dhabi, SPC and Shams in Sharjah, and RAKEZ in Ras Al Khaimah. A mainland company is licensed by the emirate's economic department and can trade directly across the UAE market. The right choice depends on your customers, your activity, the visas you need and whether you want the free zone tax regime. You'll find the full list of zones we cover on our UAE page.
How to get started
Fill in the short UAE enquiry form. Tick the services you need and any free zones or emirates you're considering; leave them blank if you'd like us to recommend. We'll come back with options and a clear quote, and our licensed UAE partners take it from there. You keep one point of contact at Filing HQ.
Staying in the UK? A UK limited company is still the simplest structure for most founders. You can form one with Filing HQ online, today.
Your UAE company, handled from the UK
- ✓ Free zone or mainland formation, in any of the seven emirates
- ✓ Residence visas, bank account guidance and corporate tax registration
- ✓ Managed payroll, with self-serve software coming if there's demand
This article is general information, not tax advice. Tax rules change — check your own position with a qualified adviser.