Qualifying Free Zone Person (QFZP)

A Qualifying Free Zone Person is a UAE free zone entity that qualifies for a 0% Corporate Tax rate on its qualifying income, with a 9% rate applying to any non-qualifying income. To qualify, the entity must maintain adequate substance in the UAE, derive qualifying income, comply with transfer pricing rules, not elect into the standard regime, and not earn excluded income. The status is assessed for each tax period, and a failure to meet the conditions — such as an impermissible direct sale to a mainland customer — can subject all of the entity's income to the standard 9% rate for that period. The regime is set out in Cabinet Decision 100/2023, Ministerial Decision 265/2023, and the Federal Tax Authority's Free Zone Persons Guide.