Ministry of Finance Eases Tax Rules for Unincorporated Partnerships
These changes, part of the broader UAE Corporate Tax plan, are designed to ease administrative burdens.
The Ministry of Finance has introduced amendments to Ministerial Decision No. 261 of 2024, aimed at streamlining tax compliance procedures for unincorporated partnerships, foreign partnerships and family foundations. These changes, part of the broader UAE Corporate Tax plan, are designed to ease administrative burdens while reinforcing the nation’s appeal as a global business hub.
One of the key revisions eliminates the obligation for unincorporated partnerships to notify the Federal Tax Authority (FTA) within 20 business days of any changes in their composition. This adjustment is expected to simplify compliance processes for businesses operating in the UAE, particularly those structured as partnerships. The updated rules will apply to tax periods beginning on or after June 1st, 2023.
The amendments also bring notable benefits for family foundations, which can now designate a juridical person to apply for tax-transparent status. This provision offers additional tax advantages and aligns family foundation benefits with the broader UAE Corporate Tax framework, especially for those managing assets within the country.
