What Are Qualifying Activities for Free Zone Persons?

To benefit from the 0% Corporate Tax rate, Free Zone Persons must engage in Qualifying Activities, which include:

  • Manufacturing and processing of goods
  • Trading in Qualifying Commodities
  • Ship management and operations
  • Fund management and reinsurance services
  • Wealth and investment management
  • Financing and leasing of aircraft
  • Logistics services within Free Zones

These activities must directly contribute to the Free Zone’s economic environment to qualify for the tax exemption.

Compliance Requirements for Free Zone Persons

Maintaining compliance under the UAE Corporate Tax Law is essential for Free Zone Persons. Key requirements include:

  • Tax registration with the Federal Tax Authority (FTA)
  • Submission of audited financial statements
  • Filing a corporate tax return within nine months of the tax period’s end
  • Keeping all relevant documentation and records for at least 7 years

Failure to meet these requirements could result in penalties or loss of preferential tax status.

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