Extraction of crude petroleum

Excluded · 9% taxable

Forensic Analysis

DZ requiredSubstance: HIGHAI-derived

Extraction of natural resources is explicitly defined as an Excluded Activity for Qualifying Free Zone Persons. Such income is typically subject to Emirate-level taxation (Sovereign Tax) rather than the Federal Corporate Tax regime. Forensic scrutiny focuses on the separation of 'Extractive Business' income from 'Non-Extractive' income within the same legal entity to prevent unauthorized tax base erosion.

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Legal Reference

Article 18 of Federal Decree-Law No. 47 of 2022 and Ministerial Decision No. 229 of 2025

Audit Red Flag

Attempting to claim the 0% Free Zone rate on 'ancillary' extraction services by mischaracterizing them as 'Distribution' or 'Headquarter' services.

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