Definition

Tax Accounting Profit refers to a company’s net profit as per its financial statements before making adjustments required by Corporate Tax law. It serves as the starting point for calculating taxable income in the UAE.

Key points

• Based on IFRS-compliant financial statements.
• Adjusted for non-deductible expenses and exempt income.
• Used to determine final Corporate Tax payable.

Practical example

A company reports an accounting profit of AED 2 million but adds back AED 200,000 in non-deductible fines, resulting in a taxable income of AED 2.2 million.

Why it matters

Accurate tax accounting profit ensures correct Corporate Tax reporting and audit readiness.