Legislation Details
- Full Title: Cabinet Resolution Regarding the Determination of the Non-Resident Person's Nexus in the State for the Purpose of Federal Decree by Law Regarding Taxation of Corporations and Businesses
- Law Type: Federal Decree-Law
- Law Number: No. (35) of 2025
- Issued Date: 27 Mar 2025
- Effective Date: [The legislation does not specify]
- Official Gazette: No. 796
- Sector: Tax
- Status: Active
- Number of Articles: 23
- Chapters/Parts: 0
- Amendments: [The legislation does not specify]
Summary
This Cabinet Resolution provides the criteria for determining when a non-resident person has a "nexus" in the UAE for the purposes of the Federal Decree-Law No. (47) of 2022 Regarding Taxation of Corporations and Businesses. It defines the circumstances under which a non-resident person will be considered to have a taxable presence in the UAE, such as deriving income from UAE real estate or making artificial transfers of real estate rights. The Resolution also requires non-resident persons with a UAE nexus to register for corporate tax. This legislation is important for businesses and individuals outside the UAE who have economic activities or assets in the country, as it clarifies their tax obligations. (Cabinet Resolution Regarding the Determination of the Non-Resident Person's Nexus in the State for the Purpose of Federal Decree by Law Regarding Taxation of Corporations and Businesses, 2025)
What is the scope and purpose of this law?
The purpose of this Cabinet Resolution is to determine the criteria for when a non-resident person has a "nexus" in the UAE for the purposes of the Federal Decree-Law No. (47) of 2022 Regarding Taxation of Corporations and Businesses. It applies to non-resident persons, defined as legal persons established, created, or recognized under the legislation of another country or foreign territory. The Resolution specifies the circumstances under which a non-resident person will be considered to have a taxable presence in the UAE, triggering corporate tax registration and compliance obligations. (Cabinet Resolution Regarding the Determination of the Non-Resident Person's Nexus in the State for the Purpose of Federal Decree by Law Regarding Taxation of Corporations and Businesses, 2025, Art. 1-2)
What are the key definitions under this law?
The Resolution provides the following key definitions:
- Immovable Asset: Any plot of land, building, structure, engineering work, fixtures, or equipment permanently attached to land or the seabed. (Cabinet Resolution Regarding the Determination of the Non-Resident Person's Nexus in the State for the Purpose of Federal Decree by Law Regarding Taxation of Corporations and Businesses, 2025, Art. 1)
- Corporate Tax Law: Federal Decree-Law No. (47) of 2022 Regarding Taxation of Corporations and Businesses, as amended. (Cabinet Resolution Regarding the Determination of the Non-Resident Person's Nexus in the State for the Purpose of Federal Decree by Law Regarding Taxation of Corporations and Businesses, 2025, Art. 1)
What are the main obligations and requirements?
The key obligations under this Resolution are: 1. Non-resident persons who have a nexus in the UAE, as defined in Article 2, must register for corporate tax with the tax authority in compliance with Article 51 of the Corporate Tax Law. (Cabinet Resolution Regarding the Determination of the Non-Resident Person's Nexus in the State for the Purpose of Federal Decree by Law Regarding Taxation of Corporations and Businesses, 2025, Art. 4) 2. The Minister may issue necessary resolutions to implement the provisions of this Resolution. (Cabinet Resolution Regarding the Determination of the Non-Resident Person's Nexus in the State for the Purpose of Federal Decree by Law Regarding Taxation of Corporations and Businesses, 2025, Art. 5)
What constitutes a "nexus" in the UAE for non-resident persons?
According to Article 2, a non-resident person will have a nexus in the UAE in the following cases: 1. Deriving income from UAE immovable property, including from its sale, lease, or other exploitation. (Cabinet Resolution Regarding the Determination of the Non-Resident Person's Nexus in the State for the Purpose of Federal Decree by Law Regarding Taxation of Corporations and Businesses, 2025, Art. 2(1)) 2. Having their income adjusted under certain provisions of Cabinet Resolution No. 34 of 2025 related to investment funds. (Cabinet Resolution Regarding the Determination of the Non-Resident Person's Nexus in the State for the Purpose of Federal Decree by Law Regarding Taxation of Corporations and Businesses, 2025, Art. 2(2-3))
What rules apply to artificial transfers of immovable property rights?
Article 3 states that if a non-resident person makes an "artificial transfer" of their real rights in UAE immovable assets to another person, and the transfer is not for a genuine commercial or non-financial purpose, it will be considered an arrangement to obtain a corporate tax advantage under the Corporate Tax Law. (Cabinet Resolution Regarding the Determination of the Non-Resident Person's Nexus in the State for the Purpose of Federal Decree by Law Regarding Taxation of Corporations and Businesses, 2025, Art. 3)
How does this law interact with other UAE legislation?
This Cabinet Resolution is related to and supplements the following legislation: - Federal Decree-Law No. (47) of 2022 Regarding Taxation of Corporations and Businesses - Cabinet Resolution No. (56) of 2023 Regarding the Determination of the Non-Resident Person's Nexus (which is repealed by this Resolution) - Cabinet Resolution No. (34) of 2025 Regarding Qualifying Investment Funds and Qualifying Limited Partnerships (Cabinet Resolution Regarding the Determination of the Non-Resident Person's Nexus in the State for the Purpose of Federal Decree by Law Regarding Taxation of Corporations and Businesses, 2025, Art. 6)
When did this law come into effect?
The legislation does not specify an effective date. However, Article 7 states that this Resolution shall apply to tax periods commencing on or after 1 January 2025. (Cabinet Resolution Regarding the Determination of the Non-Resident Person's Nexus in the State for the Purpose of Federal Decree by Law Regarding Taxation of Corporations and Businesses, 2025, Art. 7)
Source Documents
This article analyses Cabinet Resolution Regarding the Determination of the Non-Resident Person's Nexus in the State for the Purpose of Federal Decree by Law Regarding Taxation of Corporations and Businesses for legal research and educational purposes. For the purpose of interpretation and application, reference must be made to the original Arabic text. In case of conflict, the Arabic text prevails. This does not constitute legal advice.