Pension funding

Excluded · 9% taxable

Forensic Analysis

DZ requiredSubstance: HIGHAI-derived

Under the UAE Corporate Tax framework, Pension Funds are primarily treated as 'Exempt Persons' under Article 4, provided they apply for and maintain exempt status. In the context of the Qualifying Free Zone Person (QFZP) regime, pension funding is categorized as an Excluded Activity (often falling under the umbrella of regulated financial services) to prevent the overlap of the 0% QFZP rate with the specific 'Exempt Person' criteria which require stricter regulatory adherence and 'sole purpose' tests.

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Legal Reference

Article 4(1)(g) of Federal Decree-Law No. 47 of 2022 and Ministerial Decision No. 115 of 2023.

Audit Red Flag

Commingling of pension fund assets with the sponsoring employer's operational cash flows or utilizing fund assets for non-retirement related corporate financing.

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