Accounting for IT companies and consultancies in the UAE
For software and AI companies, studios working with freelancers abroad and consultancies, most of them in free zones. We keep the books in several currencies, process contractor invoices from any country, file VAT with reverse charge and Corporate Tax, and check income stream by income stream whether the 0% rate applies.
- Contractor invoicesFrom any country
- Reverse chargeVAT on imported services
- 0% or 9%CT checked by income stream
Where IT and consulting books get complicated
Software, SaaS and AI companies
Subscriptions and licences sold abroad, cloud and tool costs billed in dollars, developers in several countries. We keep the books in each currency and show margin by client or product.
Studios working with freelancers abroad
Dozens of small invoices a month from artists, developers and contractors in other countries. Each one has to be recorded, matched to a payment and included in the VAT return under reverse charge.
Management and IT consultancies
Fees by project and by client, rebilled expenses, partners paid through the company. The owner needs to see which engagements actually make money.
Free zone company with foreign clients
The company was set up in a free zone on the assumption that tax would be 0%. Whether the income actually qualifies is better checked before the return than after it.
Founder with companies in several countries
Development abroad, sales through the UAE company. Fees between your own companies must be at arm's length, and the books have to show it.
Books that keep up with a distributed team
From contractor invoices to the Corporate Tax return: the full cycle, in every currency you work in.
- Monthly bookkeeping in Zoho Books, QuickBooks or Xero, with bank accounts and cards in every currency reconciled
- Invoices from freelancers and contractors abroad collected, recorded and matched to payments, even when there are dozens a month
- Receipts and documents via a Telegram bot: forward the invoice, we do the rest
- VAT registration and quarterly returns, with reverse charge on services bought from abroad
- Zero rating checked contract by contract for services to clients outside the UAE
- Corporate Tax registration and the annual return; for free zone companies, qualifying income checked stream by stream
- Revenue and margin by client or project in a monthly owner's report
- Payroll for your UAE team, paid on time through WPS
- Fractional CFO for budgets, cash planning and investor reporting
Which clients make money, and what tax is coming
A sample monthly summary for a software and design studio in a free zone. The figures are illustrative.
| Client | Revenue | Contractor costs | Margin | Invoice status |
|---|---|---|---|---|
| Game publisher, Europe | 140,000 | 91,000 | 35% | Paid |
| SaaS company, UK | 96,000 | 48,000 | 50% | On time |
| Mobile app studio, USA | 72,000 | 50,400 | 30% | 25 days overdue |
| Retail group, Dubai | 64,000 | 25,600 | 60% | Due in 7 days |
| Fintech start-up, Singapore | 40,000 | 22,000 | 45% | On time |
What an IT or consulting company should know about UAE tax
Reverse charge on foreign services
Services bought from contractors outside the UAE fall under reverse charge: you account for 5% VAT yourself and usually recover it in the same return. In most cases the two cancel out, but each invoice still has to be recorded.
Zero rating for clients abroad
Services to clients outside the UAE can be zero-rated if the conditions are met; services to clients in the UAE carry the standard 5%. Registration is mandatory once taxable supplies over 12 months exceed AED 375,000.
The 0% rate is not automatic
A Qualifying Free Zone Person pays 0% only on qualifying income. Many IT and consulting companies selling to mainland or foreign third-party clients have no qualifying income for those services, so profit above AED 375,000 is taxed at 9%. It is checked income stream by income stream.
Substance, audit and the de minimis test
A Qualifying Free Zone Person must have adequate substance in the UAE and audited financial statements. Non-qualifying income above 5% of total revenue or AED 5 million, whichever is lower, costs the 0% rate for the period.
Payments to your other companies
Fees to the founder's other companies, intra-group charges for development and loans between them must be at arm's length under the transfer pricing rules.
From scattered invoices to a system
The price depends on volume, not on the industry
Monthly bookkeeping from AED 700; a full finance function with VAT and payroll from AED 2,000 a month. We quote an exact price after reviewing your books.
Questions IT and consulting companies ask
How does reverse charge VAT work for foreign contractors in the UAE?
If your company is registered for VAT, you account for 5% VAT on services bought from contractors abroad yourself and, as a rule, recover it in the same return. In most cases the two amounts cancel out, but each invoice has to be in the books and in the return.
Is VAT charged on IT services to clients outside the UAE?
Services to clients outside the UAE can be zero-rated if the conditions are met; services to clients in the UAE carry 5%. Whether the conditions are met depends on the contract and the client, so we check each one before the first invoice goes out.
Does a free zone IT company pay 0% Corporate Tax?
Only on qualifying income, and only as a Qualifying Free Zone Person. Among the conditions: adequate substance in the UAE, audited financial statements, and non-qualifying income within 5% of total revenue or AED 5 million, whichever is lower. Many IT and consulting companies selling to mainland or foreign third-party clients have no qualifying income for those services, so profit above AED 375,000 is taxed at 9%. We check this as part of our tax service.
Does a free zone company need to register for Corporate Tax if it expects 0%?
Yes. Every company must register for Corporate Tax and file a return, even with no profit or only exempt income. A 0% rate does not remove the obligation to file.
Can a free zone company claim Small Business Relief?
Not if it is a Qualifying Free Zone Person. A company that is not one and has revenue up to AED 3 million can elect Small Business Relief in the return for tax periods ending on or before 31 December 2026.
Does an IT company in a UAE free zone need an audit?
A Qualifying Free Zone Person needs audited financial statements every year, whatever its revenue. Other companies need them for Corporate Tax once revenue exceeds AED 50 million. We keep the books so an auditor can work with them as they are.
How much does accounting cost for an IT company in Dubai?
It depends on the number of transactions and contractor invoices a month, not on the industry: from AED 700 for monthly bookkeeping, from AED 2,000 for a full finance function with VAT and payroll. We count the real volume before we start so the price holds from the first month.
Let's sort out your business finances
Tell us about your company: where it is registered, where your clients and contractors are, and how the books are kept today. We reply within one business day.