Galadari Alerts: Public and Community Welfare Entities Eligible for Corporate Tax Exemption

Galadari Alerts: Public and Community Welfare Entities Eligible for Corporate Tax Exemption

The UAE Ministry of Finance has declared public and community welfare entities are eligible for an exemption from corporate tax, following Cabinet Resolution No. 37 of 2023. The resolution specifically targets public benefit entities focusing on activities promoting the well-being of people and society. This move acknowledges the significant roles these organisations play in religious, charitable, scientific, educational, cultural, and other similar fields in the UAE.

Qualified public interest entities must meet the conditions laid out in Article 9 of the Corporate Tax Law and comply with all applicable federal and local laws. They are required to register with the Federal Tax Authority’s corporate tax system and obtain a tax registration number. These entities must also inform the Ministry of Finance of any changes that could impact their qualified public interest entity status. The Cabinet reserves the right to modify the list of eligible public benefit entities by adding or removing entities. Grants and gifts provided to qualified public interest entities listed in the Cabinet’s Resolution are deductible expenses for corporate tax purposes.

Government entities, affiliates of the government, extractive and non-extractive natural resource businesses that meet the Corporate Tax Law’s specified requirements, and non-resident persons that earn UAE-sourced income without a permanent establishment in the state, are all exempted from registering for corporate tax.

For more information on UAE Corporate Tax, please get in touch with Gerry Rogers and Paula Villegas Guevara. Gerry and Paula are members of the Corporate and Commercial practice at Galadari, and are happy to discuss any queries you may have.

Gerry Rogers Partner [email protected]

Paula Villegas Guevara Senior Associate [email protected]