Under Ministerial Decision No. 229 of 2025, 'Manufacturing and processing of goods or materials' is a Qualifying Activity. However, ISIC 3311 (Repair) is distinct from ISIC 25 (Manufacturing). The FTA will scrutinize whether the 'repair' involves a fundamental transformation of the product (Processing) or is merely a service. Income from non-Free Zone persons for repair services is generally treated as Excluded Income unless it meets the de minimis requirements.
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Legal Reference
Article 2, Clause 1(a) and Article 3, Clause 1
Audit Red Flag
Recharacterizing 'Maintenance and Repair' services (Excluded) as 'Manufacturing or Processing' (Qualifying) to apply the 0% rate to income derived from Mainland customers.
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