Ministry of Finance Announces Cabinet Decision on Determination of Non-Resident Person's Nexus in UAE

June 05, 2023

The UAE Ministry of Finance today has announced the issuance of Cabinet Decision No. 56 of 2023 on a Non-resident Person’s Nexus in the UAE for the purposes of Federal Decree-Law No 47 of 2022 on the Taxation of Corporations and Businesses (“The Corporate Tax Law”).

His Excellency, Younis Haji Al Khoori, Undersecretary of the Ministry of Finance, said: “The Corporate Tax treatment of income derived from UAE real estate and other immovable property by foreign juridical persons is in line with international best practice which stipulates that income derived from immovable property is taxable in the country in which such property is located. The UAE’s Corporate Tax Law incorporates features that honor international taxation principles and ensures neutrality between domestic and foreign companies earning income from immovable property in the UAE.”

Foreign companies and other non-resident juridical persons will be subject to UAE Corporate Tax on income derived from real estate and other immovable property located in the UAE and will be required to register in the UAE for Corporate Tax purposes. This applies to both immovable property that is held or used in a business and immovable property that is held for investment purposes in the UAE.


Non-resident juridical persons with UAE immovable property will be subject to Corporate Tax on a net-income basis. This allows for relevant expenditure that meets the conditions set out in the Corporate Tax Law to be deducted when calculating taxable income.


Real Estate Investment Income earned from UAE immovable property owned by foreign or UAE resident individuals, either directly or through a trust, foundation or other vehicle that is treated as fiscally transparent for UAE Corporate Tax purposes, would generally not be subject to Corporate Tax provided it is not a licensed business activity. Further, Real Estate Investment Trusts and other Qualifying Investment Funds may benefit from an exemption from Corporate Tax on income derived from the investment in UAE immovable property, provided that the relevant conditions are met.

All Cabinet Decisions and Ministerial Decisions and guidelines relating to the Corporate Tax Law are available on the Ministry of Finance’s website:

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