Corporate Tax Exempt Persons
Understanding which entities qualify for corporate tax exemption in the UAE and the conditions that must be maintained to preserve exempt status.
Exemption Overview
Certain entities are exempt from UAE Corporate Tax under specific conditions. These exemptions are primarily designed for government entities and specific qualifying organizations that serve public interests.
Categories of Exempt Persons
Government Entities
Federal, Emirate, and local government entities and their wholly-owned subsidiaries
- UAE Federal Government ministries and departments
- Emirate-level government entities
- Local government authorities
- Wholly-owned government subsidiaries
Sovereign Wealth Funds
Investment funds owned and operated by the UAE government
- Abu Dhabi Investment Authority (ADIA)
- Mubadala Investment Company
- Dubai Investment Corporation
- Other government-owned investment vehicles
Pension and Social Security Funds
Government-managed retirement and social security funds
- General Pension and Social Security Authority (GPSSA)
- Emirates Fund for retirement and pensions
- Government employee benefit funds
Conditions for Exemption
Government Ownership
Entity must be wholly owned and controlled by the UAE government at federal, emirate, or local level. Partial ownership may not qualify for exemption.
Public Purpose Activities
Primary activities must serve public interest or governmental functions. Commercial activities may affect exemption status.
Regulatory Compliance
Must comply with all applicable UAE laws and regulations, including proper registration and reporting requirements.
Ongoing Qualification
Exemption status must be maintained continuously. Changes in ownership structure or activities may affect qualification.
Loss of Exempt Status
What Happens When Exemption Conditions Are Not Met?
Immediate Tax Liability: Entity becomes subject to corporate tax from the date conditions are no longer met.
Registration Requirements: Must register for corporate tax within specified timeframes.
Compliance Obligations: All standard corporate tax filing and payment obligations apply.
Retroactive Application: May need to account for tax liability from the date exemption was lost.
Maintaining Exempt Status
Documentation Requirements
- Proof of government ownership
- Entity establishment documentation
- Activity and purpose evidence
- Annual compliance certificates
Regular Reviews
- Annual status confirmation
- Ownership structure monitoring
- Activity compliance verification
- Legal requirement updates
Unsure About Your Exemption Status?
Determining and maintaining exempt status can be complex. Our tax experts can help assess your situation and ensure ongoing compliance with FTA requirements.