corporate tax<\/a> in June 2023, so it\u2019s no longer a zero-tax paradise. But the rates are still far lower than in the UK. <\/p>\n\n\n\nBusinesses pay 9% corporate tax on profits above AED 375,000. Profits below that have zero tax. <\/p>\n\n\n\n
By establishing a presence in a Free Zone and fulfilling specific requirements, you may be eligible for a 0% tax rate on qualifying income. From January 2025, multinational enterprises with revenues over \u00a3 652.8 million face 15% minimum tax. <\/p>\n\n\n\n
Here\u2019s where it gets interesting; Dubai doesn\u2019t tax personal income. Your salary, dividends, bonuses, none of it gets taxed. While comparing to the UK\u2019s 20% to 45% income tax, plus National Insurance, adding another 13.8% for employers. <\/p>\n\n\n\n
VAT in Dubai is 5% while in the UK it is 20%. And when we talk about capital gains tax, inheritance tax, wealth tax, they don\u2019t exist in the UAE. <\/p>\n\n\n\n
How much can UK business owners actually save by relocating to Dubai? <\/h2>\n\n\n\n
When we talk about savings while relocating to Dubai, business owners can benefit from significant financial advantages. Let\u2019s understand this by a real example: <\/p>\n\n\n\n
If your company makes \u00a3200,000 profit each year. <\/p>\n\n\n\n
In the UK, you first pay 25% corporation tax. That’s \u00a350,000 gone. When you take dividends, you’re taxed up to 39.35%, which could mean an additional \u00a359,000. From \u00a3200,000 profit, you might retain just \u00a391,000. <\/p>\n\n\n\n
In Dubai? You pay 9% on amounts over \u00a380,000, roughly \u00a310,800. There\u2019s no personal tax when you withdraw the money, so you keep about \u00a3189,000. That’s \u00a398,000 more each year, or nearly \u00a3490,000 over five years. <\/p>\n\n\n\n
Tax advisors often quote savings of \u00a359,000 to \u00a398,000 annually on \u00a3200,000 profits. Over five years, that totals \u00a3295,000 to \u00a3490,000 saved. This assumes everything is done correctly and your tax residence is genuinely moved. <\/p>\n\n\n\n
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