03/06/2026
Many Free Zone businesses assume their 0% Corporate Tax status is automatic. It isn't.
To qualify as a Qualifying Free Zone Person (QFZP) and enjoy the 0% rate on qualifying income, you must clear four often-overlooked hurdles:
🔹 Adequate substance — real employees, premises, and operating expenditure in the UAE. A mailbox address won't survive scrutiny.
🔹 Qualifying income only — income from non-qualifying activities or mainland customers (beyond the de minimis threshold) can taint your entire status, pushing you to 9% on all income.
🔹 Transfer pricing compliance — arm's-length pricing and documentation for related-party transactions are mandatory, regardless of your rate.
🔹 Audited financial statements — non-negotiable for QFZPs. No audit, no 0%.
The cost of getting this wrong isn't just the 9% — it's penalties, back-taxes, and a five-year disqualification from QFZP status.
With the 30 September 2026 filing deadline approaching, now is the time to review your structure, not after you file.
At Reflechir Consultancy, we help Free Zone companies validate their QFZP eligibility and file with confidence. Let's talk before the deadline does the talking.
