Autism Spectrum Disorder (ASD) is a neurodevelopmental disorder characterised by impairments in social communication and social cognition. Difficulties in emotion understanding, from emotion recognition to emotion regulation are common features that can affect the inclusion process. One outstanding question is the extent to which age and IQ affect such impairments. The effect of IQ and age on emotion understanding was estimated in 55 children with ASD aged between 5 and 10 and with IQ ranging from 70 to 130. Emotion understanding and non-verbal cognitive ability were assessed, respectively, with the Test of Emotion Comprehension and the Leiter-R scale. The majority of participants scored significantly lower on the TEC compared to the normative sample. Performance compared against norms decreased with age and improved with increasing IQ; children with 'borderline cognitive functioning' performed significantly worse than children with 'normative cognitive functioning'. Emotion understanding skills in children with ASD are affected by cognitive level and age. Implications for educational interventions are discussed.