# UAE taxable income calculator

> UAE taxable income starts with accounting profit under IFRS. You then add back non-deductible costs (50% of client entertainment, fines and penalties, donations to non-qualifying bodies) and deduct exempt income (such as qualifying dividends). Corporate tax is 9% of taxable income above AED 375,000.

Interactive calculator: https://www.countify.ae/tools/taxable-income-calculator · Updated 2026-10-14 · Countify UAE

## From accounting profit to corporate tax

AED 60,000 client entertainment, AED 5,000 fines, AED 10,000 donations, AED 40,000 exempt dividends.

| Accounting profit | Taxable income | Corporate tax (9% above AED 375,000) |
| --- | --- | --- |
| AED 300,000 | AED 305,000.00 | AED 0.00 |
| AED 900,000 | AED 905,000.00 | AED 47,700.00 |
| AED 2,000,000 | AED 2,005,000.00 | AED 146,700.00 |

Entertainment is the add-back most SMEs miss.

## The common adjustments

Most SME tax computations need only a handful of adjustments:

- Add back 50% of client entertainment ([entertainment calculator](https://www.countify.ae/tools/entertainment-expense-calculator))
- Add back fines and penalties (but not compensation for breach of contract)
- Add back donations to bodies that are not Qualifying Public Benefit Entities
- Add back corporate tax itself, dividends paid and bribes
- Deduct dividends and gains covered by the [participation exemption](https://www.countify.ae/tools/participation-exemption-checker)
- Apply [interest limitation](https://www.countify.ae/tools/interest-limitation-calculator) and [tax losses](https://www.countify.ae/tools/tax-loss-calculator) where relevant

## Getting the starting point right

The return starts from accounting profit in financial statements prepared under IFRS (or IFRS for SMEs where revenue is below AED 50 million). If your bookkeeping is behind or not IFRS-based, the tax figure will be wrong too. Our [bookkeeping](https://www.countify.ae/services/bookkeeping) and [year-end accounts](https://www.countify.ae/services/year-end-accounts) services fix that first.

## Legal basis

- Federal Decree-Law No. 47 of 2022, Articles 20 and 28–33 (https://mof.gov.ae/corporate-tax/)

## Frequently asked questions

### Is accounting profit the same as taxable income in the UAE?

No. Taxable income is accounting profit adjusted for non-deductible expenses, exempt income, interest limits and losses.

### Are fines deductible for UAE corporate tax?

No. Fines and penalties are not deductible, except amounts awarded as compensation for damages or breach of contract.

### Is depreciation deductible?

Generally yes, as recorded in IFRS accounts. There are no separate capital allowances in the UAE.