As part of our commitment to keeping you informed, our newsletter highlights key tax developments, treaties, laws and compliance updates shaping the UAE’s evolving fiscal landscape.

In this edition, we spotlight a major announcement from the Abu Dhabi Global Market (ADGM) that has significant implications for entities seeking to benefit from the UAE’s 0% corporate tax rate.

In a significant development, the ADGM Registration Authority has issued updated guidance on financial reporting obligations for companies electing or maintaining Qualifying Free Zone Person (QFZP) status under the UAE Corporate Tax regime.

Effective August 2025, all ADGM entities seeking QFZP status must prepare and maintain audited financial statements, regardless of size, revenue, or operational activity. This includes dormant and subsidiary companies that would otherwise qualify for audit exemptions under ADGM regulations. The audit requirement is now a critical condition for accessing the 0% corporate tax rate, elevating financial reporting to a strategic priority.

Key highlights:

All entities applying for QFZP status must submit audited financial statements without exception.

Financial statements must be prepared in accordance with International Financial Reporting Standards (IFRS). Dual sets of accounts are not permitted. 

Audits must be conducted by ADGM-registered audit firms. Engagements with non-registered auditors will not meet compliance standards. 

Audited financial statements must be filed with the ADGM Registrar by 30 September 2025. 

A temporary “no action” position applies to certain small entities during their first fiscal year, but this should not be interpreted as a permanent exemption.

Implications for ADGM businesses:

Entities must proactively assess their QFZP eligibility and ensure full compliance with both ADGM and UAE Corporate Tax regulations. Failure to meet the audit and filing requirements may result in the loss of QFZP status and exposure to the standard corporate tax rate.

Recommended actions:

  • Review your entity’s QFZP election and eligibility.
  • Engage an ADGM-registered auditor without delay.
  • Ensure your financial statements are IFRS-compliant and ready for submission by the deadline.

 

Find out more about relevant updates and news from our newsletter below.

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In our July & August 2025 edition of GT’s regional monthly Tax Newsletter, we provide the latest news updates affecting International Tax, Corporate Tax, Transfer Pricing, and Indirect Taxes in the UAE and across the Middle East region. 

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