The UAE has entered a new era for businesses. With the introduction of the federal corporate tax from June 1, 2023, companies across the Emirates are adjusting to a landscape that has moved beyond decades of a zero-tax environment.
If you’re running a business in the UAE, understanding how this new law works—and adopting the right tools to stay compliant—can make all the difference. One such tool is Odoo ERP, which can streamline compliance, reporting, and day-to-day financial management.
1. Understanding the New UAE Corporate Tax Framework
Effective Date:
The corporate tax applies to financial years starting on or after June 1, 2023. For businesses that follow the calendar year (Jan–Dec), the law takes effect from January 1, 2024.
Tax Rates & Thresholds:
- 0% on profits up to AED 375,000
- 9% on profits above AED 375,000
Who’s Covered:
The corporate tax applies to all UAE businesses, including those in freezones and on the mainland (although some freezone entities may retain special incentives).
Exemptions Include:
- Natural resource businesses
- Qualifying intra-group transactions
- Dividends and capital gains
- Personal income from employment or real estate
For Large Multinationals:
From January 1, 2025, the UAE will introduce a 15% Domestic Minimum Top-Up Tax for multinational enterprises with revenues of EUR 750M+ in line with the OECD’s Pillar Two framework.
2. Compliance Challenges for UAE Businesses
With the new corporate tax, UAE companies must:
- Maintain accurate and up-to-date accounting records
- File tax returns on time to avoid heavy penalties (AED 10,000 for late registration)
- Comply with new transfer pricing rules and documentation requirements
- Prepare for mandatory e-invoicing for B2B transactions starting July 2026
These requirements mean businesses need robust systems to ensure nothing slips through the cracks.
3. How Odoo ERP Simplifies Corporate Tax Management
Odoo ERP offers a complete, integrated platform that makes tax compliance easier and more efficient.
✅ Automated Compliance & Reporting
Generate real-time tax reports directly from your financial data, reducing manual work and errors.
✅ UAE-Specific Tax Customization
Easily handle the 9% corporate tax, exemptions, and separate reporting for freezone vs mainland income.
✅ Strong Audit Trails & Document Management
Attach invoices, receipts, and contracts to transactions, keeping all your compliance documents organized.
✅ Accurate Profit & Expense Tracking
Monitor cost centers, deductible expenses, and net profits without guesswork.
✅ Alerts & Integrations
Get notified about deadlines and integrate Odoo with FTA systems or your tax consultants.
Conclusion
The UAE’s new corporate tax law is here to stay, and compliance is now a critical part of doing business. But it doesn’t have to be complicated.
With Odoo ERP, you can automate reporting, stay on top of deadlines, and keep your financial records organized—leaving you more time to focus on growth.
📞 Ready to make compliance simple?
Contact Phi Care Solutions today for a free Odoo ERP demo tailored to your UAE business needs.