Abu Dhabi: The Federal Tax Authority (FTA) has completed the implementation of its comprehensive awareness campaign to raise awareness of corporate tax among business sectors for the year 2024, and held the third workshop in Abu Dhabi dedicated to persons based in free zones, to provide ongoing knowledge support to taxpayers, as part of the Authority’s efforts to ensure smooth implementation and compliance with the Corporate Tax Law that came into effect and applies to fiscal years beginning on or after June 1, 2023.

The Authority explained in a press statement today that this workshop is the final workshop during the current year within the framework of the second phase of the campaign that began last February, and included a large number of virtual events and workshops using remote video communication technology, and in-person in all emirates of the country, as the campaign addresses various tax topics to facilitate compliance with corporate tax.

It indicated that during the current year, 6 workshops were organized on the application of corporate tax for persons based in free zones (3 in-person and 3 virtual using remote video communication technology). She explained that the workshop, which was held in Abu Dhabi, witnessed a large turnout and remarkable interaction from the attendees, who numbered about 550 participants concerned with implementing corporate tax for those based in free zones. It was attended by a number of officials from the Department of Economic Development - Abu Dhabi, the Abu Dhabi Chamber of Commerce and Industry, the "KIZAD" Group, and a number of representatives of the relevant authorities in the emirate.

Zahra Al Dahmani, Director of the Taxpayer Services Department at the Federal Tax Authority, stressed during the workshop the keenness to continuously improve the services provided to support and assist business sectors, in line with the Authority's plans to establish a tax environment that encourages compliance, through continuous awareness plans to reach all categories of taxable persons, and to introduce tax legislation and procedures in various ways characterized by clear information and ease of application. During the workshop, the Authority’s representatives provided a comprehensive explanation of the application of the Corporate Tax Law for persons based in the free zones, which enables qualified persons based in the free zones to benefit from a corporate tax rate of (0%) zero percent on qualified income.

Detailed information was provided on the conditions that a person based in the free zone must meet in order to be considered a qualified person based in the free zone, and the activities that are considered qualified activities and excluded activities for a qualified person based in the free zone.

They explained how to calculate corporate tax for persons based in the free zones and determine qualified income and income subject to tax at a rate of 9%, the conditions for maintaining a sufficient and actual presence for qualified persons based in the free zones, the criteria for determining a local or foreign permanent establishment, and the criteria for treating income generated from real estate, income generated from qualified intellectual property, and tax compliance requirements.

The Authority stressed that free zones are an essential part of the country’s economy and play an important role in driving growth and economic transformation in the country, as free zones provide many advantages to businesses, including reduced restrictions on foreign ownership, simplified administrative procedures, modern and advanced infrastructure, and an advanced business community, in addition to the availability of additional types of legal entities and commercial activities.