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Dividend Tax in Dubai

Dividend Tax in Dubai

Updated on Tuesday 19th April 2016

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Dividend_Tax_in_Dubai.jpgDubai’s tax regime is one of the reasons why foreign investors are opening companies there. The city encourages foreign direct investments not only through its favorable free zones, but also through an overall low taxation regime that imposes very few taxes on its business people and residents.
Our Dubai lawyers can help you understand the taxation rules in Dubai, including those related to dividend income.

Dividends in Dubai

A company incorporated in Dubai does not have to pay tax on the dividend income received from a local or foreign investment. Dubai imposes no withholding tax on dividends paid to local or foreign recipients. Also, dividend payments are not tax-deductible from the paying company.
Shareholders of Dubai companies can be entitled to receive dividend payments, as per the company’s internal rules and regulations. The manner in which the dividend payment is made to the shareholders is chosen by the individual.
Branches in Dubai that pay dividends to a parent company abroad can benefit from the double tax treaties signed by Dubai and other countries. Our law firm in Dubai can tell you more about these treaties and can give you more information about how your business is influenced by them, apart from the regulations concerning dividends. 

Taxation in Dubai

Dubai does not impose taxes on the profits made by companies and individuals. This means that the emirate does not have a personal income tax and the corporate income tax is only applicable to a few types of companies that operate in selected business fields.
Foreign nationals who want to invest in Dubai need to comply with a few special requirements, like obtaining a free trade zone license (if investing in such a zone), the special approvals for hiring local or foreign employees and others.
Our lawyers in Dubai can help you open a company there and make all the necessary arrangements. If you have further questions about the taxation for foreign companies in Dubai or about the investment opportunities there, you can contact our Dubai law firm.


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