Tax on foreign banks

According to the law, foreign banks are subject to a 20 per cent tax on their annual taxable income.

However, if these banks pay corporate tax in accordance with Federal Law No. 47 of 2022 on the Taxation of Corporations and Businesses and its amendments, the amount of corporate tax will be deducted from their total tax liability.

Double taxation

The UAE has 142 agreements in place with other nations to avoid double taxation on investments overseas. The agreements on the Avoidance of Double Taxation are aimed to:

• promote the country's development goals and diversify its sources of national income
• eliminate double taxation as well as additional, indirect taxes and tax evasion
• eliminate any obstacles related to cross-border trade and investment flows
• provide protection to taxpayers from double taxation, whether direct or indirect
• promote the exchange of goods and services and the free movement of capital.

Income tax

The UAE does not levy income tax on individuals.

Taxes in tourist facilities

Restaurants, hotels, hotel apartments, resorts etc. in the UAE might charge one or more of the following taxes:

• 10 per cent tax on the room rate
• 10 per cent service charge
• 10 per cent municipality fees
• City tax (ranging from 6 to 10 per cent)
• 6 per cent tourism fee

In Dubai, hotels charge 'Tourism Dirham Fee' per room per night of occupancy (for a maximum of 30 consecutive nights) ranging from AED 7 to 20 depending on the category/grade of the hotel.

In May 2016, it was announced that hotels in Abu Dhabi would charge a new additional fee of 4 percent of hotel stay bill and AED 15 charges per night per room.

In Ras Al Khaimah, hotels charge AED 15 tourism fee per room per night.

Useful links: 

• Taxes, service charges and tipping - VisitAbuDhabi.ae