Let’s cut to what changed.
In 2026, every Dubai company must register for corporate tax. Registration is mandatory even if earnings are below the taxable threshold, and profits above AED 375,000 are taxed at 9%.
Free zones can still reach 0% on qualifying income, and a new rule now lets some free-zone companies trade on the mainland. Here is the practical version for founders, without the accountant jargon.
The three things you need to know
1. Corporate tax is 9% and registration is not optional. The rate is 9% on taxable profits above AED 375,000. Below that, you still pay nothing on the profit, but you must still register with the Federal Tax Authority (FTA). “I’m too small to register” is the mistake that earns penalties. There is a filing deadline, so this is a diary item, not a someday item.
2. Free zones can still hit 0% if you stay qualified. A Qualified Free Zone Person (QFZP) can keep a 0% rate on qualifying income. But there is a line you cannot cross: breach the non-qualifying income threshold (broadly 5% or AED 5M) and you lose the 0% rate for five full years. The free-zone tax break is real, but it comes with rules you have to respect.
3. Free-zone companies can now work on the mainland. This is the genuinely new bit. Executive Council Resolution No. 11 of 2025 lets certain free-zone companies operate directly in mainland Dubai without setting up a separate onshore entity. The catch is that you must keep separate books, and mainland-sourced revenue is taxed at 9%.
And one more for the calendar: e-invoicing for B2B and B2G transactions becomes mandatory, so your systems need to be ready.
What this means for your office and address
Your structure dictates your office obligation. If your income is largely international, a free zone setup keeps your tax efficient. If you need to sell across the UAE, you likely need a mainland presence.
If you are just starting or operating lean, a virtual office ejari, al sufouh provides the necessary registered address to stay compliant without the overhead of a full lease. For established teams, a professional rental meeting room in al sufouh allows you to host clients without the cost of a permanent office.
The honest advice
Don’t pick a free zone versus mainland on the licence cost alone. Pick it on where your customers are and how your income qualifies, then let that decide your office. The tax rules reward businesses that structure deliberately and punish the ones that guess. Get the structure right first, and the address and office follow naturally from it.
This is general information, not tax advice. Confirm your specifics with a licensed advisor or the FTA before you file.
Frequently Asked Questions
Do all Dubai companies have to register for corporate tax in 2026?
Yes. Every business must register with the Federal Tax Authority, even below the taxable threshold.
Can free-zone companies still pay 0% corporate tax?
Yes, if they qualify as a Qualified Free Zone Person and keep income “qualifying.” Exceeding the non-qualifying threshold (about 5% or AED 5M) forfeits the 0% rate for five years.
Can a free-zone company do business on the Dubai mainland now?
Yes, under Executive Council Resolution No. 11 of 2025, but you must keep separate records, and mainland revenue is taxed at 9%.
Do I need a physical office or is a virtual office enough?
Free zones typically allow a virtual office, while mainland activity generally requires a physical office with registered Ejari. Your structure, not your preference, decides this.
Where can I find a compliant workspace in Al Sufouh?
Workstation Business Centre in Al Sufouh 1 offers flexible solutions, including virtual office Ejari registration and hourly meeting room rentals designed to meet the compliance needs of modern UAE businesses.