Withholding Tax Calculator UAE
Calculate your cross-border tax deduction with this withholding tax calculator UAE. Check the 0% domestic rate or apply a custom DTA rate to your payments.
About This Tool
What Is Withholding Tax in the UAE?
Withholding Tax (WHT) is a deduction made at the source of a cross-border payment. The Federal Tax Authority (FTA) mandates this deduction under the 2022 tax decree for certain payments made to foreign entities.
This calculator uses the exact rules outlined in Federal Decree-Law No. 47 of 2022. It applies the 0% standard domestic rate. You can also input a custom rate to calculate gross-up or Double Taxation Agreements (DTA) impacts. No data is stored. All math runs in your browser.
Gross Payment x 0% = WHT DueGross Payment x Custom Rate% = WHT DueRelated Calculators
Other UAE Tax & Employment Tools
How It Works
How to Calculate Your UAE Withholding Tax
Most UAE-sourced payments to non-residents currently face a 0% domestic rate. Here is the exact process recognized by the FTA.
Identify the Payment
Determine the gross amount and the exact category of the cross-border payment. Common types include royalties, interest, and service fees.
Check Residency Status
Verify if the recipient is a Non-resident Person. WHT only applies to payments crossing UAE borders to foreign entities or individuals.
Apply the Domestic Rate
Apply the 0% UAE domestic rate under the 2022 tax decree. No tax is physically deducted at this rate.
Review DTA Impacts
Check if a DTA exists with the recipient country. This may change reporting requirements or how the income is taxed abroad.
Calculation Examples
See the Formula in Action
These examples show the actual math this tool performs. The first shows the standard UAE rate. The second shows a foreign WHT calculation.
Common Scenarios
When to Use This Tool
Paying Overseas Vendors
Calculate the exact WHT before paying foreign contractors for services rendered in the UAE. Verify the 0% domestic rate applies.
Reviewing DTA Treaties
Use the custom rate field to simulate WHT under a specific DTA. This helps structure cross-border deals to avoid double taxation.
Filing EmaraTax Returns
As a Withholding Agent, use the breakdown to report the exact WHT amounts on your EmaraTax portal return.
Receiving Foreign Income
UAE residents receiving foreign income can calculate the foreign WHT deducted at source to claim Foreign Tax Credits locally.
DTA Rates
Double Taxation Agreements and UAE WHT
The UAE has signed over 100 DTAs. While the domestic WHT rate is 0%, these treaties dictate how the recipient country taxes the UAE Sourced Income. Understanding the treaty rate is critical for the payee.
| Payment Type | UAE Domestic Rate | Typical DTA Range | Key Consideration |
|---|---|---|---|
| Dividends | 0% | 0% to 15% | Often 0% if parent company owns over 10% |
| Interest Income | 0% | 0% to 10% | Often 0% for bank loans or government bonds |
| Royalties | 0% | 0% to 10% | Treaty rate depends on IP usage rights |
| Service Fees | 0% | 0% to 15% | May be treated as business profits if PE exists |
Always check the specific bilateral treaty between the UAE and the recipient country. The UAE often agrees to lower rates than the standard foreign domestic rates.
Who Acts as the Withholding Agent?
A Withholding Agent is the person or entity making the payment to the non-resident. Under Cabinet Decision No. 85, this agent is legally responsible for deducting the tax and remitting it to the FTA via the EmaraTax portal.
This calculator provides estimates based on standard UAE Withholding Tax rules. It does not constitute tax advice. Actual liabilities may vary based on specific DTA articles, permanent establishment status, or foreign tax credits. For formal tax guidance, consult a FTA-registered tax agent.
Frequently Asked Questions
UAE Withholding Tax FAQs
Withholding Tax is a deduction taken at the source of a cross-border payment. In the UAE, it applies to certain payments made to non-resident entities. The current domestic rate under the 2022 tax decree is 0%.
Yes, but the domestic rate is currently 0%. While the legal framework exists to deduct tax from payments like royalties and interest to non-residents, no physical deduction is made at this standard rate.
The current UAE domestic withholding tax rate is 0%. This applies to dividends, interest, royalties, and service fees paid to non-resident persons under Article 47 of the 2022 tax decree.
The Withholding Agent is responsible. This is the person or entity making the payment to the non-resident. They must deduct the tax and remit it to the FTA via the EmaraTax portal.
Under domestic UAE law, dividends paid to non-residents are subject to a 0% WHT rate. However, the recipient country may tax those dividends based on their local laws or the specific DTA with the UAE.
It is calculated by multiplying the gross payment amount by the applicable WHT rate. In the UAE, the domestic rate is 0%, so no tax is deducted locally. Foreign jurisdictions may apply their own rates.
Yes. DTAs dictate which country has the right to tax the income. While the UAE domestic rate is 0%, a DTA limits the maximum tax the recipient country can charge on the UAE-sourced income.
The same 0% domestic WHT rate applies to Free Zone companies making payments to non-residents. Free Zone status does not change the domestic WHT obligations under Article 47.
Yes. Service fees paid to a non-resident for services performed in the UAE fall under WHT rules. The current domestic rate is 0%. If the non-resident has a Permanent Establishment, it may be taxed as business profits instead.
Failing to deduct or remit WHT results in penalties. The FTA can charge the unpaid tax amount plus an administrative penalty. Withholding Agents must strictly follow remittance deadlines to avoid these fines.