UAE tax loss relief calculator
UAE companies can carry tax losses forward indefinitely, but each year they can only offset losses against 75% of taxable income. So at least 25% of profit stays taxable (subject to the AED 375,000 0% band) even when large losses are available.
Reviewed by Countify's ACCA/FCCA chartered certified accountants · Updated
- Losses used (max 75% of income)
- AED 750,000.00
- Taxable income after relief
- AED 250,000.00
- Corporate tax
- AED 0.00
- Losses still to carry forward
- AED 450,000.00
Losses carry forward indefinitely, but are lost if ownership changes by more than 50% and the business changes. Losses from before corporate tax applied, or from a Small Business Relief year, cannot be used.
Results are estimates for general information, not tailored advice.
Using AED 1.2m of losses
The 75% cap means some tax is usually still due.
| Taxable income | Losses used (max 75% of income) | Corporate tax | Losses still to carry forward |
|---|---|---|---|
| AED 400,000 | AED 300,000.00 | AED 0.00 | AED 900,000.00 |
| AED 1,000,000 | AED 750,000.00 | AED 0.00 | AED 450,000.00 |
| AED 3,000,000 | AED 1,200,000.00 | AED 128,250.00 | AED 0.00 |
With income of AED 1m, only AED 750,000 of losses can be used this year.
The rules for using losses
Losses arising from the first corporate tax period onwards can be carried forward. Losses from before corporate tax applied, from exempt activities, or from a year in which you elected Small Business Relief cannot be used.
- Offset up to 75% of taxable income a year
- No time limit
- Lost if ownership changes by more than 50%, unless the business continues the same or similar activities
Moving losses within a group
Companies under 75% common ownership can transfer losses to each other, within the same 75% cap. Companies owned 95% or more can instead form a tax group.
Legal basis
We review this calculator whenever the FTA or Ministry of Finance issues a new decision or clarification.
Frequently asked questions
How long can I carry forward tax losses in the UAE?
Indefinitely, as long as the ownership and business continuity conditions are met.
Can losses wipe out all my taxable income?
No. Losses can offset at most 75% of taxable income in a tax period.
Corporate tax registration and returns
We register you, prepare the tax computation and file your corporate tax return, with Small Business Relief, QFZP and loss elections handled correctly.