Every person who is conducting business in a Free Zone is automatically a Free Zone person. However, in order to be a qualified a Free Zone Person, all the conditions below must be met. Even if one condition is not met, then the Free Zone Person will not qualify Free Zone Person.
● The entity must have and maintain the sufficient substance in the UAE. This means he is carrying out business activities in the jurisdiction of the UAE instead of only registering for tax-related reasons.
● He is earning “Qualifying Income” that will be specified by the Cabinet Decision.
● He complies with transfer pricing rules and he is maintaining the related transfer pricing documentation with him.
● He has not elected to pay the corporate tax in full.
The Minister may add more conditions to this list so it is a good idea to check the Ministry of Finance website for additional details as more information can be added in the future.