UAE Tax CT Corporate Tax: mock exams and practice questions

Sample question 1 · A · Scope, taxable persons and registration

Dunemark Logistics LLC, a UAE mainland company, has always prepared its financial statements for 12-month periods ending 31 May and has never applied to change its financial year. Which is Dunemark's first Tax Period for UAE Corporate Tax?

1. A 1 June 2023 to 31 May 2024
2. B 1 June 2024 to 31 May 2025
3. C 1 January 2024 to 31 December 2024
4. D 1 June 2023 to 31 December 2023

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Answer: A. The CT Law (Federal Decree-Law No. 47 of 2022) applies to tax periods starting on or after 1 June 2023 (Article 69, which applies the law to tax periods commencing on or after that date), and under Article 57 a tax period is the financial year: the Gregorian calendar year or the 12-month period for which financial statements are prepared.

Dunemark's financial year 1 June 2023 to 31 May 2024 starts on 1 June 2023, so it is the first tax period. A company with a 31 May year-end therefore came into the regime earlier than a calendar-year company, whose first tax period is 1 January to 31 December 2024.

Sample question 2 · B · Free zones, small business relief and exempt income

Mirqab Trading FZE, a Qualifying Free Zone Person, reports FY2026 total revenue of AED 140,000,000. Non-qualifying revenue (all from transactions with mainland customers outside any qualifying activity) is AED 5,600,000. Which statement about the de minimis requirement is correct?

1. A It is met, because AED 5.6m is only 4% of total revenue, below the 5% limit.
2. B It fails, because AED 5.6m exceeds AED 5,000,000, which is the lower of the two limits.
3. C It fails, because non-qualifying revenue exceeds AED 3,000,000 in the tax period.
4. D It is met, because the AED 5m cap applies only where revenue is below AED 100m.

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Answer: B. De minimis limit = lower of 5% x AED 140,000,000 = AED 7,000,000 and AED 5,000,000, so AED 5,000,000 (Cabinet Decision No. 100 of 2023, Article 4).

Non-qualifying revenue of AED 5,600,000 is 4% of total revenue but exceeds AED 5,000,000, so the requirement is failed. For large free zone businesses (revenue above AED 100m) the fixed AED 5m cap is always the binding limit. Failing the test means Mirqab ceases to be a QFZP from the start of FY2026 (Article 18, CT Law; MD 229/2025).

Sample question 3 · C · Taxable income and the tax computation

Tamarisk Holdings LLC is a mainland UAE company that owns 100% of two UAE subsidiaries. It prepares IFRS consolidated financial statements for the group and separate financial statements for itself. The companies have not formed a tax group. For its Corporate Tax return, from which figure does Tamarisk start when computing its taxable income?

1. A Net profit for the year in the group's consolidated financial statements
2. B Consolidated profit attributable to the owners of Tamarisk as parent
3. C Tamarisk's cash receipts less cash payments recorded in the tax period
4. D Net profit in Tamarisk's own standalone financial statements, then adjusted

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Answer: D. Under Article 20(1), Corporate Tax Law, the taxable income of each taxable person is determined separately on the basis of its standalone financial statements prepared under accepted accounting standards. Article 20(2) then requires the accounting income to be adjusted (unrealised items, exempt income, reliefs, non-deductible amounts, transfer pricing and so on). Consolidated figures are relevant only where a tax group is formed (Article 40), which is not the case here.