Chapter 1: General Definitions under the UAE Corporate Tax Law
As per Article 1 of Chapter 1 of the UAE Corporate Tax Law provides the definitions of terms used in it so as to aid in its better understanding and effective implementation and application of its provisions. Some of these are:
Join our UAE Corporate Tax Course| Term | Definitions |
| Authority | The Authority is the Federal Tax Authority. |
| State | The State is the United Arab Emirates or UAE. |
| Taxable Person | A Taxable Person is one on whom Corporate Tax is imposed/applicable. |
| Taxable Income | Taxable Income is that income which is subject to Corporate Tax. |
| Government Controlled Entity | Any legal entity that is directly or indirectly entirely owned and controlled by a Government Entity is known as Government Controlled Entity |
| Mandated Activity | A Mandated Activity is one which is conducted by a Government Controlled Entity, in accordance with the legislation regulating such an entity. |
| Qualifying Income | Qualifying Income refers to income earned by a Qualifying Free Zone Person. It will be subject to Corporate Tax as per the Law. |
| Tax Return | A Tax Return is the information filed with the Federal Tax Authority along with schedules and attachments for the purposes of Corporate Tax. |
| Tax Period | A Tax Period refers to the period for which Tax Return is to be filed. |
| Revenue | Revenue is the gross amount of income earned during the Tax Period. |
| Recognised Stock Exchange | A Recognised Stock Exchange is one that is licensed and regulated by Authority. It includes stock exchanges that are established in the State or outside the State of UAE. |
| Free Zone | A Free Zone is such a zone that is a designated geographical area in a State as per the decision by the Cabinet at the recommendation of the Minister of Finance, UAE. |
| Free Zone Person | A Free Zone Person refers to a juridical person which is incorporated, established and registered in the Free Zone and also includes a branch of a Non-Resident registered in the Free Zone. |
| Unincorporated Partnership | An Unincorporated Partnership is a contractual relationship between two or more persons (a partnership, trust or any other such association of persons) as per the applicable law in the State. |
| Corporate Tax Payable | A Corporate Tax Payable is the amount which will become due to be payable to the Authority. |
| Exempt Income | An Exempt Income is such income which is exempt from Corporate Tax under the Law. |
| Tax Registration Number | A Tax Registration Number is a unique number given to every person registered for Corporate Tax. It is given by the Federal Tax Authority. |
| Tax Registration | A Tax Registration is a process whereby a person registers for Corporate Tax purposes. |
| Tax Deregistration | A Tax Deregistration is a process whereby a person deregisters from Corporate Tax purposes. |
| Tax Loss | A Tax Loss is a negative Taxable Income for a given Tax Period |
| Accounting Income | An Accounting Income as per the Financial Statement prepared for the relevant Tax Period, refers to the net profit or loss in the particular Tax Period. |
| Foreign Partnership | A Foreign Partnership is a contractual relationship established between two or more persons (a partnership, trust or any other such association of persons) as per laws of the foreign jurisdiction. |
| Foreign Tax Credit | A Foreign Tax Credit is the tax paid on income and profit under the foreign jurisdiction is deducted from Corporate Tax which is due. |
| Market Value | The Market Value is the amount agreed as per the arm’s length principles by persons who are not Connected Persons or Related Parties in a similar transaction. |
| Extractive Business | Extractive Business is the activity related to exploring, removing, extracting natural resources in the State. |
| Non-Extractive Business | Non-Extractive Business is the activity related to separating, refining, treating, processing, transporting, marketing, distribution or storing of natural resources. |
| Net Interest Expenditure | Net Interest Expenditure is interest expenditure in excess to interest income as determined through the Law. |
| Withholding Tax Credit | Withholding Tax Credit is the amount that is deducted from the Corporate Tax due to be paid to the Federal Tax Authority. |
| Withholding Tax | The Withholding Tax is the Corporate Tax which is withheld from the State sourced income. |
