UAE free zone qualifying income
Test the de minimis limit and the other free zone conditions.
Open itThe Emirati economic substance regime was closed off for later financial years, and most of what is written about it is now out of date. Enter your financial year dates and this says whether the regime reaches that year, and what is due if it does.
The financial year
The first day of the financial period you are asking about.
The last day of that period.
A juridical person or unincorporated partnership registered in the Emirates, including in a free zone.
Banking, insurance, investment fund management, lease-finance, headquarters, shipping, holding company, intellectual property or distribution and service centre business.
The notification and the report are triggered differently, and income is what brings the report in.
Position for this year
—
Regime window ends —
Financial year inside the regime window —
Financial year starts after the window closed —
Notification —
Report —
Regime window starts—
Regime window ends—
Check the year before you check the substance
The Emirati economic substance regime applied to financial years falling within a defined window. A later amendment limited its application to that window, so entities with financial years commencing after it are no longer required to file a notification or a report — and administrative penalties charged for those later years were cancelled and refunded.
That makes the first question a date question, not a substance question. A great deal of published material still describes annual substance filings as an ongoing obligation, because it was written while they were. Enter the year you are actually asking about and the answer for that year comes first.
What still matters, and what replaced it
For a financial year inside the window, the obligations were real and the penalties for missing them were significant. If you are cleaning up historic filings for those years, or responding to an assessment for one of them, the regime is live for that period and the substance test has to be met on the facts of that year.
For later years, the questions the regime used to ask have not gone away — they have moved. Where the core income-generating activity actually happens, whether there are people and premises behind the income, and whether the entity is more than a nameplate are now asked by corporate tax residence, by the free zone substance condition, and by the permanent establishment rules in the other country. Those are live, and they are asked with more force than the old notification ever did.
Worked example
A free zone holding company with a calendar financial year asks whether it has substance filings outstanding.
- For the year ending 31 December 2022, the year sits inside the window: it was a licensee, holding company business is a relevant activity, and a notification was due with a report where income was earned.
- For the year starting 1 January 2023, the year commences after the window closed, so no notification and no report arise.
- Any penalty charged for a post-window year was cancelled, so an outstanding demand for one of those years is worth querying rather than paying.
Change the dates in the panel between those two years and watch every flag flip. Same entity, same activity, different answer entirely.
What this calculator assumes
- The regime window dates are the current ones following the amendment that limited the regime, and they are shown in the readout so you can see what the test is.
- Whether an activity is a relevant activity, and whether an entity is a licensee, are definitional questions this tool takes your answer on.
- For a year inside the window the substance test itself has to be met on that year's facts. This checker tells you whether a filing arises, not whether the test was passed.
- The substance questions now live in corporate tax residence, the free zone substance condition and the permanent establishment rules in the other country. None of those is modelled here.
An estimate, not advice. This is an estimate built from what you typed, not advice on your file. Nothing here reads your documents, checks your treaty article or looks at the year you are actually in. Where the number matters, we agree a fixed fee in writing before any work starts.
Where these figures come from
- current guidance Economic substance regulations — UAE Ministry of Finance
- current guidance Corporate tax — UAE Ministry of Finance
- current guidance Corporate tax — Federal Tax Authority
Any figure prefilled in the panel above is stated with the year it belongs to and can be changed. Rates and thresholds move; a calculator that asks you for the current one stays right, and one that hides a guess does not.
What these engagements turn on
Case study 1
Trips That Added Up to a Filing Obligation
Short visits are tracked against a treaty threshold that is measured over a moving window rather than a calendar year. Where the threshold is passed, the obligation reaches back over the whole period.
Read how this one runs
Case study 2
Gains on Indian Shares Held From Abroad
Holding period and instrument decide the character of the gain, and the deduction at source applies before any of that is considered. The return is where the position is corrected.
Read how this one runs
Case study 3
A US Citizen Settled in India, Filing on Both Sides
Residence in India and citizenship in the United States produce two annual returns for one income. The order decides the credit, and the Indian financial year and the US calendar year have to be reconciled before either is prepared.
Read how this one runs
Case study 4
A Home Kept in Canada After the Move Abroad
A dwelling left available is the tie the CRA weighs most heavily, and its treatment differs depending on whether it is rented at arm's length. The file settles the residence position first and the rental reporting second.
Read how this one runs
Case study 5
Indian Transfer Pricing Certification With a Hard Deadline
An Indian entity with international related-party transactions needs an accountant's report filed by a date of its own, ahead of the return. The work is reconciling the transactions to the books first, because the report is only as defensible as that reconciliation.
Read how this one runs
Case study 6
First Canadian Return After Arriving Mid-Year
The arrival date splits the year and sets the cost base of what you brought with you. Getting that date and those values right is what determines whether a later sale is taxed on the whole gain or only on the part that accrued after landing.
Read how this one runs
Case study 7
A Trust Abroad With a Canadian Connection
Contributions or beneficiaries in Canada can bring a foreign trust inside the Canadian net entirely. The analysis is who contributed what and when, because the answer decides whether the trust files here at all.
Read how this one runs
Case study 8
Interest and Penalties Put to a Relief Application
Relief is discretionary and is decided on the circumstances that caused the delay, evidenced year by year. The application is built from the same chronology the filings rest on, so the two cannot contradict each other.
Read how this one runsAll case studies — every published engagement in one place.
Core International & Cross-Border Tax Services
International Tax Planning & Advisory
Strategy and compliance for income, assets and families spread across borders.
One coordinating team: filings on every side of the border are sequenced so treaty relief and foreign tax credits are claimed once — and in the right country.
U.S. & Cross-Border Tax Returns
Dual filers: U.S. citizens in Canada and Canadians with U.S. income run two parallel systems — we prepare both, in the right order, every year.
Expat & Emigration Tax
The move year is its own project: the elections and valuations filed that year decide the next decade of both countries’ returns.
Non-Resident Canadian Tax
Default withholding is 25% of gross: elective returns routinely turn over-withheld rent and pensions into refunds.
Transfer Pricing & BEPS
Documentation prepared with the return is the cheapest insurance in international tax; reconstructing it during an audit is the most expensive.
Tax Treaties & Withholding
Relief is only as good as the paperwork claiming it — we build treaty positions that survive review on both sides.
Cross-Border Estates & Trusts
Wills drafted for one country routinely misfire in the other — deemed disposition here, estate tax there, credits in between.
Global Investments & Reporting
Information returns carry the sharpest penalties — $25 a day whether or not any tax is owing. We keep them clean and on time.
Cross-Border Corporate Tax
Expansion raises the same four questions every time — entity, PE, repatriation, payroll. We answer them before the tax authorities do.
India Tax for NRIs & Returning Residents
The deduction is taken on the sale price, not the gain — which is why an NRI property sale strands cash unless the certificate is applied for before closing.
Canadian Tax with a Foreign Element
Residency is decided on facts, not on a form — and the year you arrive or leave is the one where the largest amounts turn on the smallest details.
UAE Tax for Expats & Their Home Country
A zero-tax country is only half the answer — the question that decides the bill is whether the country you came from still treats you as resident.
Industries & Client Types We Serve Worldwide
Global E-commerce & Marketplaces
Technology & SaaS
Professional Services Firms
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Importers, Exporters & Manufacturers
Athletes, Artists & Entertainers
Remote Workers & Digital Nomads
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Global E-commerce & Marketplaces
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Technology & SaaS
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- IP structuring with real substance
- Equity for cross-border teams
- U.S. expansion: entity & PE setup
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Professional Services Firms
Firms and partners working across borders meet Regulation 105 withholding, PE risk on long engagements and per-country payroll for travelling staff.
A partnership is taxed in the hands of its partners, so one engagement abroad can reach every partner's personal return. The order matters: the waiver is applied for before the invoice, the presence is tracked before it becomes an establishment, and the payroll is registered before the first day worked in the other country.
- Reg 105 / 102 waivers
- Permanent establishment risk
- Partner mobility planning
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Cross-Border Real Estate
- Section 216 rental returns
- FIRPTA withholding recovery
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Importers, Exporters & Manufacturers
- Transfer pricing documentation (s.247)
- Customs value vs transfer price
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- Country-by-country reporting
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Athletes, Artists & Entertainers
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Remote Workers & Digital Nomads
- Residency analysis before moving
- Employer payroll exposure
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Investment Funds & Holding Companies
- Treaty access & PPT reviews
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- Governance & substance
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