0% is not a vested right
Since UAE Corporate Tax came into force, many Freezone structures assume they benefit from a 0% rate. In reality, that rate applies only to a qualifying share of income, and under strict conditions of substance, activity and accounting.
Three conditions too often ignored
- Real economic substance in the UAE: the empty shell no longer suffices.
- Qualifying income: only certain activities and flows open the regime.
- Compliant accounting and audited financial statements according to the applicable thresholds.
Accounting becomes defensive
The era of “no need for accounting in the UAE” is over. Compliant bookkeeping, ready for an audit, is no longer optional: it is the condition for the regime and the first line of defence if the authority raises a question.
What to do now
Audit your structure’s real eligibility, document substance and put defensive accounting in place before the first filing deadline. Anticipating costs a fraction of what an imposed regularisation costs.
This is work Prosilame handles: securing your Qualifying Free Zone Person status.
This article is general information and does not constitute legal advice. Each situation calls for its own analysis.