The UAE has recently announced rules regarding the taxation of income from real estate investments
The UAE has recently announced rules regarding the taxation of income from real estate investmentsThese rules clarify whether income from real estate investments is subject to corporate tax in the country. The Ministry of Finance issued a cabinet decision outlining these rules, which apply to both foreign companies and property owners based outside the UAE
Here are the key points:
- Foreign companies and non-resident juridical persons will be subject to corporate tax on income derived from real estate and other immovable property located in the UAE
- Non-resident juridical persons with immovable property in the UAE will be subject to corporate tax on a net-income basis, allowing for relevant expenditure to be deducted when calculating taxable income
- Real estate investment income earned from immovable property owned by foreign or resident individuals, either directly or through a trust, foundation, or other vehicle, would generally not be subject to corporate tax if it is not a licensed business activity
- Real estate investment trusts and other qualifying investment funds may be exempt from corporate tax on income derived from investments in UAE immovable property, provided certain conditions are met
These rules aim to ensure neutrality between domestic and foreign companies earning income from immovable property in the UAE
It is important to rely on official publications from the Ministry of Finance and the Federal Tax Authority for accurate information on these tax regulations
