Corporate Tax


Cabinet Decision No. 81 of 2023 on Conditions for Qualifying Investment Funds

Art. 10(1) of the CT Law prescribes the conditions to be satisfied by a Qualifying Investment Fund (QIF) for being exempt from UAE Corporate Tax.

The Cabinet has prescribed additional conditions for Qualifying Investment Funds for the purposes of Corporate Tax Law through its decision vide Cabinet Decision No. 81 of 2023.

Conditions to be satisfied by QIF [excluding Real Estate Investment Trust (REIT)]

*The main Business Activities conducted by the investment fund should be Investment Business Activities and any other Business should be ancillary or incidental thereto

**A single investor and its related parties do not have more than 30% ownership interest, where the fund has less than 10 investors

**A single investor and its related parties do not have more than 50% ownership interest, where the fund has 10 or more investors

The fund is managed by Investment Manager having at least 3 investment professionals

The investors shall have no control over the day to day management of the fund

*For the purposes of application of this condition, the following must be observed:

  • The Taxable Income of the Resident Investment Manager shall be adjusted to include the income attributed to the resident investment fund
  • Business or Business Activities of an Investment Manager attributed to a resident investment fund shall be considered to be Investment Business activities in one of the following conditions: (i) Is subject to Corporate Tax, or (ii) The activities undertaken by the Investment Manager are independent in nature as prescribed under Art. 15(1)
  • Revenue from Other Business Activities conducted by the investment fund should not exceed 5% of the total Revenue in the same Financial Year

    **The conditions of ownership shall be considered to have met in the first 2 Financial Years of the establishment of the fund, provided there is sufficient evidence to demonstrate the intentions of the investors to meet the conditions going forward.

    If the investment fund does not meet the condition as specified above, the investment fund shall cease to be treated as an Exempt Person from the beginning of the 3rd Financial Year of its establishment.

Income of the investor of QIF

Income of an investor in the Qualifying Investment Fund in a Tax Period shall be adjusted to include the income and the expenditure of the Qualifying Investment Fund in proportion to its ownership interest.

Any distribution received from a Qualifying Investment Fund shall not be included if it has been previously included.

Conditions to be satisfied by REIT

The value of real estate assets, excluding land, under the management or ownership of the REIT exceeds AED 100 mn.

At least 20% of the share capital of the REIT is floated on a Recognized Stock Exchange, or it is directly wholly owned by two or more institutional investors and at least two of those institutional investors are not Related Parties.

The REIT has an average Real Estate Asset Percentage of at least 70% during the relevant Gregorian calendar year, or the relevant 12 month period for which the financial statements are prepared

Unincorporated Partnership

An Unincorporated Partnership that is considered a Taxable Person in its own right shall be considered an entity under the definition of the Qualifying Investment Fund under the Corporate Tax Law.


An institutional investor is any of the following:

  • The Federal Government.
  • A Local Government.
  • A Government Entity.
  • A Government Controlled Entity.
  • A foreign government, its institutions and authorities or the companies fully owned by any of them.
  • International organisations.
  • A Bank.
  • An Insurance Provider.
  • A pension or social security fund.
  • An investment entity licensed by a relevant competent authority or a similar regulatory authority in or outside of the State.
  • Any other juridical person determined by the Authority.

The portion of the Real Estate Income generating assets as a percentage of the total value of the assets of the investment fund.

The issuing of investment interests to raise funds or pool investor funds or establish a joint investment fund with the aim of enabling the holder of such an investment interest to benefit from the profits or gains resulting from the entity's acquisition, holding, management or disposal of investments, in accordance with the applicable legislation of the State

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