The United Arab Emirates (UAE) has introduced a corporate tax regime that provides relief for qualifying income earned by businesses operating in certain free zones. But which free zones qualify for this relief, and what are the benefits of operating in these zones? In this article, we’ll explore the free zones that qualify for the ‘qualifying income’ corporate tax relief and what this means for businesses operating in the UAE.
Understanding the Corporate Tax Regime in the UAE
The UAE has introduced a corporate tax regime that applies to businesses operating in the country. The regime provides for a 0% corporate tax rate for qualifying income earned by businesses operating in certain free zones. This means that businesses operating in these zones can benefit from a 0% tax rate on their qualifying income, making the UAE an attractive destination for businesses looking to minimize their tax liabilities.
Free Zones that Qualify for the ‘Qualifying Income’ Corporate Tax Relief
The following free zones qualify for the ‘qualifying income’ corporate tax relief:
- Dubai International Financial Centre (DIFC): The DIFC is a leading financial hub in the UAE and is one of the free zones that qualifies for the corporate tax relief.
- Abu Dhabi Global Market (ADGM): The ADGM is a financial free zone located in Abu Dhabi and is another zone that qualifies for the corporate tax relief.
- Dubai Free Zones: Certain free zones in Dubai, such as the Dubai Airport Free Zone and the Jebel Ali Free Zone, also qualify for the corporate tax relief.
- Ras Al Khaimah International Corporate Centre (RAKICC): The RAKICC is a free zone located in Ras Al Khaimah and is another zone that qualifies for the corporate tax relief.
Benefits of Operating in a Free Zone
Operating in a free zone that qualifies for the ‘qualifying income’ corporate tax relief can provide several benefits for businesses, including:
- 0% Corporate Tax Rate: Businesses operating in these zones can benefit from a 0% corporate tax rate on their qualifying income.
- 100% Foreign Ownership: Free zones in the UAE allow for 100% foreign ownership, making it easier for international businesses to set up and operate in the country.
- No Restrictions on Capital Repatriation: Free zones in the UAE do not have any restrictions on capital repatriation, making it easier for businesses to repatriate their profits.
- State-of-the-Art Infrastructure: Free zones in the UAE offer state-of-the-art infrastructure, including advanced telecommunications and logistics facilities.
Get Expert Advice on Free Zones with Gulf Inquiries
At Gulf Inquiries, we have expertise in free zones and can provide businesses with guidance on which zones qualify for the ‘qualifying income’ corporate tax relief. Whether you’re a business looking to set up in a free zone or an existing business looking to take advantage of the corporate tax relief, we can help. Visit us today at gulfinquiries.com to learn more.