Personal Income Tax
- The UAE does not impose any personal income tax – there is no tax on salaries, wages, bonuses, allowances, or any other employment income
- Consequently, employees have no personal income tax filing or registration obligations.
Social Security Contributions (UAE Nationals Only)
- As of October 2023, UAE national employees joining the labour market for the first time in the private sector are subject to social security contributions as per the below:
- Standard rate: 20% of gross remuneration, with 5% paid by the employee, 12.5% by the employer, and 2.5% contributed by the government
- In Abu Dhabi, a higher overall rate of 26% applies, structured as 5% employee, 15% employer, and 6% government
- The maximum base amount is AED 70,000 and the total contribution is 26%.
- Expatriates are exempt from these contributions.
Corporate Tax
- As of June 2023, the UAE introduced a 9% corporate tax (CT) on business profits exceeding AED 375,000, applicable to businesses and self-employed individuals.
- Salaries, personal investment income, and real estate income are not considered corporate turnover and are exempt from CT.
Corporate Tax Exemptions
Exemptions include:
- Individuals’ employment income
- Bank interest and real estate income (for personal capacity)
- Dividends and capital gains from qualifying shareholdings
- Income from foreign permanent establishments (under defined conditions)
Value-Added Tax (VAT)
- The UAE enforces a 5% VAT on goods and services, borne by the end consumer
- Employees indirectly pay this tax through everyday consumption—e.g., meals, fuel, and utilities.
Excise Tax
- Applies to specific “sin” or harmful goods:
- 100% on tobacco and energy drinks
- 50% on carbonated and other sweetened beverages
Summary Table:
| Tax/Contribution | Applies To | Rate / Threshold | Payable By |
|---|---|---|---|
| Personal Income Tax | All employment income | 0% | – |
| Social Security | UAE national employees | 20% (general), 26% in Abu Dhabi | Employee & Employer |
| Corporate Tax (CT) | Business profits > AED 375k | 9% | Business / Self-Employed |
| VAT | Goods & services consumption | 5% | Consumers |
| Excise Tax | Tobacco, energy drinks, sugary drinks | 50-100% | Consumers via products |
GPSSA (General Pension and Social Security Authority):
The General Pension and Social Security Authority (GPSSA) is the UAE’s federal body that takes care of pension and social security matters for Emirati citizens working in both government and private sectors, except for those employed by the governments of Abu Dhabi and Sharjah.
UAE national employees are subject to social security contributions:
| Emirates | Criteria | Maximum Base Amount | Total Contribution | Employee Contribution | Employer Contribution |
| Dubai and Other Emirates | Less than 2000 AED | 70,000 AED | 26% | 11% | 12.50% |
| Dubai and Other Emirates | Joined Job Market Before 31 Oct 2023 | 70,000 AED | 20% | 5% | 15.00% |
| Dubai and Other Emirates | New in Job Market after 31 Oct 2023 | 70,000 AED | 26% | 11% | 15.00% |
| Abu Dhabi | Joined Job Market Before 31 Oct 2023 | 150,000 AED | 20% | 5% | 15.00% |
| Abu Dhabi | New in Job Market after 31 Oct 2023 | 100,000 AED | 26% | 11% | 15.00% |
End of Service Benefits – All foreign employees working in the UAE are eligible for Gratuity:
| Tenurity | Days |
| Less then 1 Year | – |
| 1-5 Years | 21 Days |
| Above 5 Years | 30 Days |
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Understanding and complying with employment tax regulations in the UAE is essential for minimizing tax liabilities and avoiding penalties.
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Please note that all the information listed below are to be used as a general guideline. For more detailed accounts of UAE employment laws and regulations, please visit the official governmental websites.
Updated on: November 2025
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