Cabinet (Minister) Decisions that are referred to in the UAE Corporate Tax Law and their status
| Article | Article Section | Link |
|---|---|---|
| Article 1 - Definitions | Government Controlled Entity: Any juridical person, directly or indirectly wholly owned and controlled by a Government Entity, as specified in a decision issued by the Cabinet at the suggestion of the Minister. | Ministerial Decision No. 68 of 2023 on the Treatment of all Businesses and Business Activities Conducted by a Government Entity as a Single Taxable Person (opens in a new tab) |
| Mandated Activity: Any activity conducted by a Government Controlled Entity in accordance with the legal instrument establishing or regulating the entity, that is specified in a decision issued by the Cabinet at the suggestion of the Minister. | ||
| Extractive Business: The Business or Business Activity of exploring, extracting, removing, or otherwise producing and exploiting the Natural Resources of the State or any interest therein as determined by the Minister. | ||
| Qualifying Public Benefit Entity: Any entity that meets the conditions set out in Article 9 of this Decree-Law and that is listed in a decision issued by the Cabinet at the suggestion of the Minister. | Cabinet Decision No. 37 of 2023 Regarding the Qualifying Public Benefit Entities (opens in a new tab) | |
| Free Zone: A designated and defined geographic area within the State that is specified in a decision issued by the Cabinet at the suggestion of the Minister. | ||
| Qualifying Business Activity: Any activity that is specified in a decision issued by the Cabinet at the suggestion of the Minister. | ||
| Article 3 - Corporate Tax Rate | 1. Corporate Tax shall be imposed on the Taxable Income at the following rates: a) 0% (zero percent) on the portion of the Taxable Income not exceeding the amount specified in a decision issued by the Cabinet at the suggestion of the Minister. b) 9% (nine percent) on Taxable Income that exceeds the amount specified in a decision issued by the Cabinet at the suggestion of the Minister. | Cabinet of Ministers Decision No. 116 of 2022 on the annual Taxable Income subject to Corporate Tax (opens in a new tab) |
| 2. Corporate Tax shall be imposed on a Qualifying Free Zone Person at the following rates: a) 0% (zero percent) on Qualifying Income. b) 9% (nine percent) on Taxable Income that is not Qualifying Income under Article 18 of this Decree-Law and any decision issued by the Cabinet at the suggestion of the Minister in respect thereof. | ||
| Article 4 - Exempt Person | 1. The following Persons shall be exempt from Corporate Tax: .... g) A public pension or social security fund, or a private pension or social security fund that is subject to regulatory oversight of the competent authority in the State and that meets any other conditions that may be prescribed by the Minister. .... i) Any other Person as may be determined in a decision issued by the Cabinet at the suggestion of the Minister. | |
| 6. For the purposes of Clause 5 of this Article, the Minister may prescribe the conditions under which a Person may continue to be an Exempt Person, or cease to be an Exempt Person from a different date, in any of the following instances: a) Failure to meet the conditions is the result of the liquidation or termination of the Person. b) Failure to meet the conditions is of a temporary nature and will be promptly rectified, and appropriate procedures are in place to monitor the compliance with the relevant conditions of this Decree-Law. c) Any other instances as may be prescribed by the Minister. | Ministerial Decision No. 105 of 2023 on the Determination of the Conditions under which a Person may Continue to be Deemed as an Exempt Person, or Cease to be Deemed as an Exempt Person from a Different Date (opens in a new tab) | |
| Article 5 - Government Entity | 6. A Government Entity may apply to the Authority for all its Businesses and Business Activities to be treated as a single Taxable Person for the purposes of this Decree-Law subject to meeting the conditions to be prescribed by the Minister. | Ministerial Decision No. 68 of 2023 on the Treatment of all Businesses and Business Activities Conducted by a Government Entity as a Single Taxable Person (opens in a new tab) |
| Article 9 - Qualifying Public Benefit Entity | 1. A Qualifying Public Benefit Entity shall be exempt from Corporate Tax where all of the following conditions are met: .... e) Any other conditions as may be prescribed in a decision issued by the Cabinet at the suggestion of the Minister. | Cabinet Decision No. 37 of 2023 Regarding the Qualifying Public Benefit Entities (opens in a new tab) |
| 2. The exemption under Clause 1 of this Article shall be effective from the beginning of the Tax Period in which the Qualifying Public Benefit Entity is listed in the Cabinet decision issued at the suggestion of the Minister or any other date determined by the Minister. | ||
| Article 10 β Qualifying Investment Fund | 1. An investment fund may apply to the Authority to be exempt from Corporate Tax as a Qualifying Investment Fund where all of the following conditions are met: ... d. Any other conditions as may be prescribed in a decision issued by Cabinet at the suggestion of the Minister. | Cabinet Decision No. 81 of 2023 On Conditions for Qualifying Investment Funds (opens in a new tab) |
| Article 11 - Taxable Person | 3. A Resident Person is any of the following Persons: a) A juridical person that is incorporated or otherwise established or recognised under the applicable legislation of the State, including a Free Zone Person. b) A juridical person that is incorporated or otherwise established or recognised under the applicable legislation of a foreign jurisdiction that is effectively managed and controlled in the State. c) A natural person who conducts a Business or Business Activity in the State. d) Any other Person as may be determined in a decision issued by the Cabinet at the suggestion of the Minister. | |
| 4. A Non-Resident Person is a Person who is not considered a Resident Person under Clause 3 of this Article and that either: a) Has a Permanent Establishment in the State as under Article 14 of this Decree-Law. b) Derives State Sourced Income as under Article 13 of this Decree-Law. c) Has a nexus in the State as specified in a decision issued by the Cabinet at the suggestion of the Minister. | ||
| 6. The Cabinet shall, upon a suggestion of the Minister and in coordination with the relevant competent authorities, issue a decision specifying the categories of Business or Business Activity conducted by a resident or non-resident natural person that are subject to Corporate Tax under this Decree-Law. | Cabinet Decision No. 49 of 2023 On Specifying the Categories of Businesses or Business Activities Conducted by a Resident or Non-Resident Natural Person that are Subject to Corporate Tax (opens in a new tab) | |
| Article 12 - Corporate Tax Base | 3. A Non-Resident Person is subject to Corporate Tax on the following: a) The Taxable Income that is attributable to the Permanent Establishment of the Non-Resident Person in the State. b) State Sourced Income that is not attributable to a Permanent Establishment of the Non-Resident Person in the State. c) The Taxable Income that is attributable to the nexus of the Non-Resident Person in the State as determined in a decision issued by the Cabinet pursuant to paragraph (c) of Clause 4 of Article 11 of this Decree-Law. | |
| Article 14 - Permanent Establishment | 1. A Non-Resident Person has a Permanent Establishment in the State in any of the following instances: a) Where it has a fixed or permanent place in the State through which the Business of the Non-Resident Person, or any part thereof, is conducted. b) Where a Person has and habitually exercises an authority to conduct a Business or Business Activity in the State on behalf of the Non-Resident Person. c) Where it has any other form of nexus in the State as specified in a decision issued by the Cabinet at the suggestion of the Minister. | Ministerial Decision No. 83 of 2023 on the Determination of the Conditions under which the Presence of a Natural Person in the State would not Create a Permanent Establishment for a Non-Resident Person (opens in a new tab) |
| Article 15 - Investment Manager Exemption | 1. For the purposes of Clause 6 of Article 14 of this Decree-Law, an Investment Manager shall be considered an independent agent when acting on behalf of a Non-Resident Person, where all of the following conditions are met: .... g) Any such other conditions as may be prescribed in a decision issued by the Cabinet at the suggestion of the Minister. | |
| Article 16 β Partners in an Unincorporated Partnership | 1. Unless an application is made under Clause 8 of this Article, and subject to any conditions the Minister may prescribe, an Unincorporated Partnership shall not be considered a Taxable Person in its own right, and Persons conducting a Business as an Unincorporated Partnership shall be treated as individual Taxable Persons for the purposes of this Decree-Law. | Ministerial Decision No. 127 of 2023 Unincorporated Partnership, Foreign Partnership and Family Foundation (opens in a new tab) |
| Article 17 - Family Foundation | 1. A Family Foundation can make an application to the Authority to be treated as an Unincorporated Partnership for the purposes of this Decree-Law where all of the following conditions are met: ... e) Any other conditions as may be prescribed by the Minister. | Ministerial Decision No. 127 of 2023 Unincorporated Partnership, Foreign Partnership and Family Foundation (opens in a new tab) |
| Article 18 - Qualifying Free Zone Person | 1. A Qualifying Free Zone Person is a Free Zone Person that meets all of the following conditions: a) Maintains adequate substance in the State. b) Derives Qualifying Income as specified in a decision issued by the Cabinet at the suggestion of the Minister. c) Has not elected to be subject to Corporate Tax under Article 19 of this Decree-Law. d) Complies with Articles 34 and 55 of this Decree-Law. e) Meets any other conditions as may be prescribed by the Minister. | Ministerial Decision No. 139 of 2023 Regarding Qualifying Activities and Excluded Activities (opens in a new tab) |
| 3. Notwithstanding Clause 2 of this Article, the Minister may prescribe the conditions or circumstances under which a Person may continue to be a Qualifying Free Zone Person, or cease to be a Qualifying Free Zone Person from a different date. | Cabinet Decision No. 55 of 2023 on Qualifying Income (opens in a new tab) | |
| 4. The application of paragraph (a) of Clause 2 of Article 3 of this Decree-Law to a Qualifying Free Zone Person shall apply for the remainder of the tax incentive period stipulated in the applicable legislation of the Free Zone in which the Qualifying Free Zone Person is registered, which period may be extended in accordance with any conditions as may be determined in a decision issued by the Cabinet at the suggestion of the Minister, but any one period shall not exceed (50) fifty years. | ||
| Article 20 - General Rules for Determining Taxable Income | 2. The Taxable Income for a Tax Period shall be the Accounting Income for that period, and to the extent applicable, adjusted for the following: .... g) Any incentives or special reliefs for a Qualifying Business Activity as specified in a decision issued by the Cabinet at the suggestion of the Minister. h) Any income or expenditure that has not otherwise been taken into account in determining the Taxable Income under the provisions of this Decree-Law as may be specified in a decision issued by the Cabinet at the suggestion of the Minister. i) Any other adjustments as may be specified by the Minister. | Ministerial Decision No. 120 of 2023 on the Adjustments Under the Transitional Rules (opens in a new tab) |
| Ministerial Decision No.134 of 2023 on the General Rules for Determining Taxable Income (opens in a new tab) | ||
| Ministerial Decision No. 114 of 2023 on the Accounting Standards and Methods (opens in a new tab) | ||
| Article 21 - Small Business Relief | 1. A Taxable Person that is a Resident Person may elect to be treated as not having derived any Taxable Income for a Tax Period where: a) the Revenue of the Taxable Person for the relevant Tax Period and previous Tax Periods does not exceed a threshold to be set by the Minister; and b) the Taxable Person meets all other conditions prescribed by the Minister. | Ministerial Decision No. 73 of 2023 on Small Business Relief for the Purposes of Federal Decree-Law No. 47 of 2022 (opens in a new tab) |
| Article 23 - Participation Exemption | 2. A Participating Interest means, a 5% (five percent) or greater ownership interest in the shares or capital of a juridical person, referred to as a βParticipationβ for the purposes of this Chapter where all of the following conditions are met: .... e) Any other conditions as may be prescribed by the Minister. | |
| 4. A Participation in a Qualifying Free Zone Person or an Exempt Person shall be treated as having met the condition under paragraph (b) of Clause 2 of this Article, subject to any conditions that may be prescribed by the Minister. | ||
| 11. The Minister may prescribe that an ownership interest in the shares or capital of a juridical person meets the minimum ownership requirement under Clause 2 of this Article where the acquisition cost of that ownership interest exceeds a threshold specified by the Minister. | ||
| Article 26 β Transfers Within a Qualifying Group | Ministerial Decision No. 132 of 2023 Transfers Within a Qualifying Group (opens in a new tab) | |
| Article 27 - Business Restructuring Relief | 3. For the purposes of this Decree-Law, where a Taxable Person applies Clause 1 of this Article, all of the following must be observed: ... d) Any unutilised Tax Losses incurred by the Taxable Person that is the transferor prior to the Tax Period in which the transfer under Clause 1 of this Article completes may become carried forward Tax Losses of the Taxable Person that is the transferee, subject to conditions to be prescribed by the Minister. | |
| Article 28 - Deductible Expenditure | 2. For the purposes of calculating the Taxable Income for a Tax Period, no deduction is allowed for the following: a) Expenditure not incurred for the purposes of the Taxable Personβs Business. b) Expenditure incurred in deriving Exempt Income. c) Losses not connected with or arising out of the Taxable Personβs Business. d) Such other expenditure as may be specified in a decision issued by the Cabinet at the suggestion of the Minister. | |
| Article 30 - General Interest Deduction Limitation Rule | 3. The limitation under Clause 1 of this Article shall not apply where the Net Interest Expenditure of the Taxable Person for the relevant Tax Period does not exceed an amount specified by the Minister. | |
| 6. Clauses 1 to 5 of this Article shall not apply to the following Persons: a) A Bank. b) An Insurance Provider. c) A natural person undertaking a Business or Business Activity in the State. d) Any other Person as may be determined by the Minister. | ||
| Article 32 - Entertainment Expenditure | 2. Clause 1 of this Article applies to any expenditure incurred for the purposes of receiving and entertaining the Taxable Personβs customers, shareholders, suppliers or other business partners, including, but not limited to, expenditure in connection with any of the following: ... f) Such other expenditure as specified by the Minister. | |
| Article 33 - Non-deductible Expenditure | No deduction is allowed for: ... Such other expenditure as specified in a decision issued by the Cabinet at the suggestion of the Minister. | |
| Article 36 - Payments to Connected Persons | 6. Clause 1 of this Article shall not apply to any of the following: a) A Taxable Person whose shares are traded on a Recognised Stock Exchange. b) A Taxable Person that is subject to the regulatory oversight of a competent authority in the State. c) Any other Person as may be determined in a decision issued by the Cabinet at the suggestion of the Minister. | |
| Article 37 - Tax Loss Relief | 2. The amount of Tax Loss used to reduce the Taxable Income for any subsequent Tax Period cannot exceed 75% (seventy-five percent) or any other percentage as specified in a decision issued by the Cabinet at the suggestion of the Minister of the Taxable Income for that Tax Period before any Tax Loss relief, except in circumstances that may be prescribed in a decision issued by the Cabinet at the suggestion of the Minister. | |
| Article 40 - Tax Group | Ministerial Decision No. 125 of 2023 on Tax Group (opens in a new tab) | |
| Article 44 - Calculation and Settlement of Corporate Tax | The Corporate Tax due under this Decree-Law is settled in the following order: To the extent there is a residual amount after Clause 2 of this Article, by using any credits or other forms of relief as specified in a decision issued by the Cabinet at the suggestion of the Minister. | |
| Article 45 - Withholding Tax | 1. The following income shall be subject to Withholding Tax at the rate of 0% (zero percent) or any other rate as specified in a decision issued by the Cabinet at the suggestion of the Minister: a) The categories of State Sourced Income derived by a Non-Resident Person as prescribed in the decision issued by the Cabinet pursuant to this Article, insofar such income is not attributable to a Permanent Establishment of the Non-Resident Person in the State. b) Any other income as specified in a decision issued by the Cabinet at the suggestion of the Minister. | |
| Article 51 - Tax Registration | 1. Any Taxable Person shall register for Corporate Tax with the Authority in the form and manner and within the timeline prescribed by the Authority and obtain a Tax Registration Number, except in circumstances prescribed by the Minister. | Ministerial Decision No. 43 of 2023 Concerning Exception from Tax Registration for the Purpose of Federal Decree-Law No. 47 of 2022 on the Taxation of Corporations and Businesses (opens in a new tab) |
| Article 54 - Financial Statements | 2. The Minister may issue a decision requiring categories of Taxable Persons to prepare and maintain audited or certified financial statements. | Ministerial Decision No. 82 of 2023 on the Determination of Categories of Taxable Persons Required to Prepare and Maintain Audited Financial Statements (opens in a new tab) |
| Article 55 - Transfer Pricing Documentation | 2. If a Taxable Personβs transactions with its Related Parties and Connected Persons for a Tax Period meet the conditions prescribed by the Minister, the Taxable Person must maintain both a master file and a local file in the form prescribed by the Authority. | Ministerial Decision No. 97 of 2023 Requirements for Maintaining Transfer Pricing Documentation (opens in a new tab) |
| Article 61 - Transitional Rules | 1. A Taxable Personβs opening balance sheet for Corporate Tax purposes shall be the closing balance sheet prepared for financial reporting purposes under accounting standards applied in the State on the last day of the Financial Year that ends immediately before their first Tax Period commences, subject to any conditions or adjustments that may be prescribed by the Minister. | Ministerial Decision No. 120 of 2023 on the Adjustments Under the Transitional Rules (opens in a new tab) |