UAE Corporate Tax – Qualifying Free Zone

QUALIFYING FREEZONE PERSON – CONDITIONS

Corporate Tax on Free zone Business- Qualifying & Non qualifying, (Cabinet Decision no. 55 & Ministerial Decision no. 139)

Corporate Tax on Free zone – Qualifying Activities (CD 55 & MD 139)

Qualifying Activities:

Goods:

Manufacturing of Goods or materials (PCD: Fully fledged & Contract/ toll manufacturing)
Processing of Goods or materials
Distribution of imported goods or materials in or from a Designated Zone to reseller

Services & Others:

Holding of shares and other securities
Ownership, management and operation of Ships
Reinsurance services
Fund management services
Wealth and investment management services
Headquarter services to Related Parties
Treasury and financing services to Related Parties
Financing and leasing of Aircraft, including engines and rotable components
Logistics services
Ancillary activities to above

* Subject to the respective UAE regulatory authority oversight

Corporate Tax on Free zone – Excluded Activities (CD 55 & MD 139)

Excluded Activities (Non-qualifying revenue)

Transaction with Natural Person (except to Ownership or management of ship/ Fund management services/ Wealth & investment management/ Financing & leasing of aircraft)
Banking activities
Insurance activities (other than reinsurance)
Financing and leasing activities, except 1) Financing to related parties & 2) Related to aircraft
Ownership or exploitation of immovable property, except the transaction with another free zone person related to immovable commercial property in free zone
Intellectual property assets income
Ancillary activities to above

Corporate Tax on Free Zone Business – Qualifying & Non Qualifying – De Minimis Requirement

One of the condition for Qualifying Free Zone Persons (QFZP) is to satisfy De MinimisRequirement, for which Non-Qualifying Revenue should not exceed below limits.

Qualifying Free Zone (QFZ) Taxability

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