Microenterprises Make Up 82% of UAE’s Business Landscape

Microenterprises—defined as businesses with fewer than five employees or annual revenues under AED 3 million—now represent 82% of all companies operating in the UAE, according to a new report issued by the Ministry of Finance.

Under the UAE’s evolving corporate tax system, microenterprises are subject to a 9% tax on net profits exceeding AED 375,000. However, the ministry has introduced a series of measures to support the sector, including exemptions for profits under the AED 375,000 threshold and simplified registration processes for smaller businesses.

This widespread presence of microenterprises underscores the decentralised and entrepreneurial nature of the UAE’s economy. From freelancers to family-run start-ups, these small-scale ventures contribute significantly to national output. The updated tax policy signals an effort by the government to support financial sustainability while encouraging grassroots business growth across the Emirates.