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Exempt Person: categories

Applies
FY2024 onwards
Reviewed
Rule
UAE-CT-EXEMPT-2024.1
By

Who is an Exempt Person for UAE Corporate Tax?

A person in a category listed in Article 4 that becomes exempt by that category's route: automatically, by notification, by Cabinet listing or by FTA approval.

Per Federal Decree-Law No. 47 of 2022, Article 4, Exempt Person

A person is an Exempt Person where they fall within one of the listed categories and become exempt by that category's mechanism — automatically, on notification to the Ministry of Finance, on being listed in a Cabinet Decision, or on application to and approval by the FTA — with the relevant conditions met.

An Exempt Person is outside the Corporate Tax charge for its exempt activity. Some categories need no Corporate Tax registration unless the person undertakes a taxable Business; others require registration. Which registration treatment attaches to which category is not encoded here — see the review notes.

The categories of Exempt Person

Each category becomes exempt by a different route, and in every case the relevant conditions must be met.

Automatically exempt

  • Government Entity

Exempt on notifying the Ministry of Finance

  • Extractive Business
  • Non-Extractive Natural Resource Business

Exempt when listed in a Cabinet Decision

  • Government Controlled Entity — for its mandated activities
  • Qualifying Public Benefit Entity

Exempt on application to, and approval by, the FTA

  • Qualifying Investment Fund
  • Public or private pension or social security fund
  • Wholly owned and controlled UAE subsidiary of certain Exempt Persons

Order of testing

  1. 1

    Inputs requiring your determination

    Any input a person must decide and has not decided stops the computation. An undecided input is never read as a no. The category is asked first, because the questions that follow depend on it.

  2. 2

    Automatic exemption

    A category that is exempt automatically (Government Entity) needs no procedural step; it is exempt where the relevant conditions are met.

  3. 3

    Notification to the Ministry of Finance

    Extractive and non-extractive natural resource businesses become exempt on notification to the Ministry of Finance, with the relevant conditions met.

  4. 4

    Listed in a Cabinet Decision

    Government Controlled Entities (for their mandated activities) and Qualifying Public Benefit Entities become exempt on being listed in the relevant Cabinet Decision, with the relevant conditions met.

  5. 5

    Application to and approval by the FTA

    Qualifying Investment Funds, pension and social security funds, and wholly owned and controlled UAE subsidiaries of certain Exempt Persons become exempt on application to and approval by the FTA, with the relevant conditions met. The procedural step is tested before the conditions: an approval not yet given is an incomplete process, not a failed condition.

  6. 6

    Relevant conditions

    Once the mechanism's procedural step is complete, the relevant conditions for the category must be met. Reported separately from the procedural step.

Examples

Illustrative scenarios — ours, not the authority’s — each computed live by this rule. Change any fact and the outcome is the rule’s, not a hand-written answer.

Government entity

A UAE federal government department. Exempt automatically, with no notification, listing or application needed.

Computed

An Exempt Person as computed: an automatically exempt category with its relevant conditions met, based on the determinations you supplied.

Decided by the automatic exemption

Approved investment fund

A qualifying investment fund that has applied to and been approved by the FTA and meets the fund conditions.

Computed

An Exempt Person as computed: application to and approval by the fta is complete and the relevant conditions are met, based on the determinations you supplied.

Decided by the application to and approval by the fta

Fund awaiting approval

The same fund, which meets the conditions but has not yet been approved by the FTA.

Computed

Not exempt as computed: application to and approval by the fta has not been completed for this category, based on the determination you supplied.

Decided by the application to and approval by the fta

Extractive business, notified

An extractive business that has notified the Ministry of Finance and meets the conditions for the category.

Computed

An Exempt Person as computed: notification to the ministry of finance is complete and the relevant conditions are met, based on the determinations you supplied.

Decided by the notification to the ministry of finance

Try it

Supply the facts and this rule computes the outcome in your browser, live. Leave a determination undecided and it blocks the result — it is never read as a no.

Not computed yet

1 input still need your determination:

  • Which category of Exempt Person is claimed? One of: government-entity, extractive-business, non-extractive-natural-resource-business, government-controlled-entity, qualifying-public-benefit-entity, qualifying-investment-fund, pension-or-social-security-fund, exempt-person-subsidiary.

Computed in your browser from the figures you supply. Nothing is sent anywhere, and the result is a computation against a rule — reference, not tax advice.

Sources

Share this rule

Reference, not tax advice.

Pankaj Agarwal — Tax Technology Leader