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Qualifying Public Benefit Entities as per Corporate Tax UAE

Cabinet Decision No.37 of 2023 furnishes provisions for Qualifying Public Benefit Entities. Qualifying Public Benefit Entities are exempted for Corporate Tax purposes if they meet the specific conditions stipulated in the Corporate Tax Law. Thus, it is advisable for Taxable Persons to seek the expert services of reputable Tax Consultants in UAE to effectively determine their taxability in compliance with the statutory tax regulations.  

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  • To comply with the corporate tax law, Qualifying Public Benefit Entities must submit all relevant documentation, information, and data to both the Authority and the Ministry. This information is necessary to confirm that they meet the requirements specified in the corporate tax law. Submitting the required documentation is essential for Qualifying Public Benefit Entities to maintain tax-exempt status and avoid any potential penalties or legal issues. It is important to ensure that all the necessary information is provided accurately and in a timely manner to comply with the legal requirements. 
  • The Ministry and the Authority must receive complete cooperation from all State government entities in order to supply them with all data, information, and documentation pertaining to a Qualifying Public Benefit Entity and its operations.
  • To carry out the directives of this Decision, the Ministry and the Authority are permitted to communicate information and documents regarding any Qualifying Public Benefit Entity and its operations.

The Ministerial Decision referenced in this article provides a list of entities that are founded for the welfare of the public and should be recognized as a Qualifying Public Benefit Entity (QPBE) for UAE Corporation Tax purposes, subject to meeting specific conditions. Such an entity is exempted from corporate tax. The purpose of this decision is to identify the entities that are eligible for tax exemptions and to provide clarity to taxpayers and tax authorities.

The tax authority may ask for pertinent information to certify that a QPBE satisfies the requirements outlined in Article 9 of the Corporate Tax Law and to track its ongoing compliance status. This information could include financial records, regulatory compliance reports, and other documentation related to the QPBE's activities. The QPBE is responsible for providing all the necessary documentation to support its eligibility for the QPBE status.

It is important to note that the tax authority may also conduct a substance-over-form review to assess the QPBE's compliance with the Corporate Tax Law. This review is an evaluation of the actual activities and operations of the QPBE, rather than just its legal form.

If there are any changes that may affect an entity's status as a QPBE, such as a change in its legal structure or a change in its activities, the entity should communicate these changes to the tax authority within 20 days. Failure to communicate such changes could result in penalties or other legal consequences.

Choose Tax Consultants in UAE

It is advisable for Taxable Persons to seek the expert services of reputable Tax Consultants in UAE to effectively determine their taxability in compliance with the statutory tax regulations. Thus, contact us today and we shall be glad to assist you.  

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Ervee is a CPA with international experience in Tax and Accounting. He has over 12 years of experience in accounting and bookkeeping and over a year in VAT implementation, registration, and accounting in UAE. He regularly drives out inefficiencies in company operations and loves the challenge of helping clients find additional ways for an easier and improved compliance and verification of transactions.