25 April 2023
The Ministry of Finance has announced a new Cabinet decision
that has exempted 'qualified public benefit entities' from corporate tax.
Entities qualifying as Public Benefit Entity can avail this
exemption for financial years starting on or after 1 June 2023.
To qualify for UAE Corporate Tax exemption under the Federal
Decree-Law No. (47) of 2022 on the Taxation of Corporations and Businesses,
entities must comply with all local, state, and federal laws and notify the
Ministry of Finance of any changes that may affect their status as Qualifying
Public Benefit Entities.
These entities must also comply with Article (9) of the
Corporate Tax Law, which states:
a) An Entity that is established and operated for the
following should be exempted:
Exclusively for religious, charitable, scientific, artistic,
cultural, athletic, educational, healthcare, environmental, humanitarian,
animal protection or other similar purposes.
A professional entity, chamber of commerce, or a similar
entity operated exclusively for the promotion of social welfare or public
b) It does not conduct Business Activity, except for such
activities that directly relate to or are fulfilling the purpose for which the
entity was established.
c) Its income or assets are used exclusively for purpose for
which it was established, or for the payment of any associated necessary and
reasonable expenditure incurred.
d) No part of its income or assets is payable to, or
otherwise available, for the personal benefit of anyone that is not itself a
Qualifying Public Benefit Entity, Government Entity or Government Controlled
It is important to note that Public benefit entities should
register with the Federal Tax Authority and obtain a registration number for
corporate tax in order to get the exemption from Corporate Tax.
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