UAE: Finance Ministry Announces Freezone Tax Policy, Exemptions
The UAE Ministry of Finance released two new decisions that specify the main features of the new Corporate Tax regime which went into effect on June 1st.
The new decisions outlined by the ministry and relevant tax authorities during a press conference in Abu Dhabi include Cabinet Decision No. 55 of 2023 on Determining Qualifying Income and the Ministerial Decision No. 139 of 2023 on Qualifying Activities and Excluded Activities.
The Freezone Corporate Tax regime is available to ‘Free Zone Persons.’ As clarified by the ministry, this refers to a juridical person that is incorporated or otherwise formed or registered in a Free Zone.
It is only applicable within the prescribed areas of the Free Zones. To confirm whether the free zone is eligible for zero per cent tax, businesses can contact their Free Zone Authority.
It will only be applied to income derived from activities that are performed exclusively in or from within a free zone.
