Federal Tax Authority Hosts New Successful Awareness Workshop in Dubai on Corporate Tax for Free Zone Persons

Dubai, 16 September 2024: The Federal Tax Authority (FTA) successfully concluded an awareness workshop on Corporate Tax for Free Zone Persons today in Dubai, which marked a key milestone in the second phase of the FTA's nationwide Corporate Tax Awareness Campaign. The campaign is aimed at providing valuable insights into the Corporate Tax regime and specifically considering various topics, such as Free Zone Persons subject to Corporate Tax.

In a press statement today, the FTA highlighted that this workshop a testament to its dedication to providing Free Zone Persons with the knowledge and resources they need to navigate the UAE's Corporate Tax regime successfully. The FTA reaffirmed its commitment to supporting Free Zone Persons and highlighted the crucial role of Free Zones in driving sustainable economic growth and innovation in the UAE.

Free Zones are vital to the UAE's economic diversification strategy, and the FTA is committed to ensuring their continued growth and contribution to the national economy by making tax compliance as seamless as possible. The FTA is committed to providing the necessary support and resources to ensure that Free Zone Persons can meet their tax obligations efficiently.

As part of its efforts to clarify the Corporate Tax legislation for Free Zone Persons, the FTA has provided a dedicated Corporate Tax Guide for Free Zone Persons on its website, with comprehensive information and practical examples to enhance understanding.

During the workshop, the FTA emphasised that Qualifying Free Zone Persons can benefit from a 0% Corporate Tax rate on their Qualifying Income under the UAE Corporate Tax regime. However, all Free Zone Persons must register for Corporate Tax, regardless of whether they are a Qualifying Free Zone Person or not. The 0% rate applies specifically to Qualifying Income, which has specific conditions that need to be met as outlined by the FTA. Income that does not meet the "Qualifying Income" conditions will be taxed at the standard Corporate Tax rate of 9%.

The workshop offered a comprehensive explanation of the Corporate Tax regime for Free Zone Persons, the conditions for qualifying for the 0% tax rate, and the requirements for income to be classified as "Qualifying Income". The FTA representatives discussed Qualifying Activities, Excluded Activities, guidance on calculating tax liabilities for Free Zone Persons, and the procedures for fulfilling their Corporate Tax obligations, including registration and filing their Corporate Tax Returns.

The FTA also clarified that Resident juridical persons with Licences issued in July, regardless of the issuance year, must submit their registration applications by 30 September 2024.

Corporate Tax registration is accessible 24/7 through the "EmaraTax" platform, allowing users to complete the process in just a few minutes. Taxable Persons can also get help from certified Tax Agents for Corporate Tax on the FTA’s website. Additionally, the FTA has expanded submission channels for registration applications through government service centres throughout the UAE.

The FTA has shown strong support for businesses transitioning to the Corporate Tax regime by hosting 40 events in the first half of 2024 which is a 135.29% increase from the previous year. These initiatives engaged over 8,220 participants, reflecting a 9.23% year-on-year rise in engagement, with 97.5% of attendees expressing satisfaction with the FTA initiatives.