AI agents for business finance: what they can and can't do
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The short answer
A freelancer in the UAE must register for corporate tax once their business turnover in a calendar year exceeds AED 1 million, according to the Federal Tax Authority; below that, an individual is not a taxable person for corporate tax. Registration is due by 31 March of the following year (for example, 2025 turnover over the threshold means registering by 31 March 2026), and late registration carries a AED 10,000 penalty.
The rule for individuals
UAE corporate tax took effect on 1 June 2023. It applies to companies, but also to individuals ("natural persons") who run a business in the UAE. The Federal Tax Authority's guidance, announced in December 2023, set the test: an individual conducting business must register and obtain a tax registration number if their total turnover from that business exceeds AED 1 million in a Gregorian calendar year, starting with 2024.
In January 2025 the FTA restated the timing: registration is due by 31 March of the year after the year in which turnover first exceeded AED 1 million. It said a person who misses that deadline faces an administrative penalty of AED 10,000. These are information from the FTA's own announcements, not tax advice.
What counts towards the AED 1 million
The test is turnover, meaning what you bill and earn from your freelance business, not profit. Expenses do not reduce it. Count all business income from the activity, whichever country the client is in: an invoice to a Lagos company counts as much as one to a Dubai agency.
Some income is outside corporate tax for individuals. Reporting on the law in December 2022, Gulf News said salaries from employment, personal income from bank deposits and savings, and real estate investment held by individuals in their personal capacity are not subject to corporate tax. If you have a salaried job and a side practice, only the side practice's turnover goes towards the business test.
Worked example (illustrative)
| Freelancer (example) | 2025 business turnover | Registers? | Deadline |
|---|---|---|---|
| Designer billing Nigerian and UAE clients | AED 640,000 | No | Not applicable |
| Developer on long contracts | AED 1,150,000 | Yes | 31 March 2026 |
| Consultant with a salary of AED 300,000 and side fees of AED 820,000 | AED 820,000 (salary excluded) | No | Not applicable |
In the third case, salary plus fees totals AED 1,120,000, but the salary is not business turnover, so the business figure of AED 820,000 stays under the threshold.
Rates, once you are in
Registering does not mean paying 9% on everything. Gulf News' summary of the corporate tax law reported a 0% rate on taxable profits up to AED 375,000 and 9% above that. Taxable profit is income after allowable business expenses, so good records matter: see recording expenses as a UAE freelancer. Relief for small businesses may also apply; our guide to the small business relief threshold covers whether you can elect it.
How to register
- Track your turnover monthly, in dirhams, so you know when you cross AED 1 million.
- Create an account on EmaraTax, the FTA's online platform (available around the clock), with your email and phone number, or use your existing account if you are already registered for VAT.
- Choose corporate tax registration and complete the application, using the FTA's taxpayer user manual if needed. Tas'heel centres can also submit applications.
- Keep the tax registration number on file; you will need it for returns and may need it for banks.
- Diary the first return; our guide to the first corporate tax return explains the timing.
If you crossed the threshold and did not register
If your business turnover passed AED 1 million in an earlier year and 31 March of the following year has gone, the FTA's January 2025 statement says the late registration penalty is AED 10,000. Register as soon as you can and ask the FTA, or a registered tax agent, which periods your first return must cover. Gather your invoices and bank records for that year first, so your application and first return agree. Our guide to the missed registration penalty covers this in more detail.
Nigerian clients and the turnover count
Two points catch freelancers with Nigerian clients. First, the turnover is what you invoiced, not what arrived: if a Nigerian client withheld 10% tax, the gross invoice still counts. Second, a naira invoice has to be translated into dirhams for the total, and the naira can move sharply within a year, so write down the rate and its source each time.
VAT is a separate test
Corporate tax and VAT have different thresholds. The Ministry of Finance sets mandatory VAT registration at AED 375,000 of taxable supplies and imports, so many freelancers meet the VAT test well before the corporate tax one. See UAE VAT for freelancers billing Nigerian clients.
Where Pryme fits
A Pryme Business Account keeps Nigerian client receipts in NGN or USD, each with its own record, which makes the turnover count easier to evidence. The Finance agent can prepare a monthly turnover summary from your invoices for you to check; it prepares the work, and you or your accountant file with the FTA.
Questions people ask
Do freelancers in Dubai pay corporate tax?
Only if their business turnover exceeds AED 1 million in a calendar year, according to the FTA. Below that, an individual is not a taxable person for corporate tax.
When must I register for UAE corporate tax as a freelancer?
By 31 March of the year after the year your business turnover first exceeded AED 1 million.
What is the penalty for late corporate tax registration in the UAE?
The FTA states an administrative penalty of AED 10,000.
Does my salary count towards the AED 1 million?
No. Salaries from employment are not subject to corporate tax, as reported when the law was issued; only business turnover counts.
Sources
- Federal Tax Authority: guide on natural persons subject to Corporate Tax (24 Dec 2023) · accessed Oct 2026
- Federal Tax Authority: natural persons to register for Corporate Tax before end of March 2025 (28 Jan 2025) · accessed Oct 2026
- Gulf News: 9% UAE corporate tax for profits over Dh375,000 (9 Dec 2022) · accessed Oct 2026
- UAE Ministry of Finance: Value Added Tax (page updated 22 Oct 2026) · accessed Oct 2026
This article is general information, not financial, legal or tax advice. Products described are provided under the terms on this site and are subject to regulation and eligibility.