29 August 2026 · Definition
What Counts as Net Interest Expenditure
Net Interest Expenditure is your interest expenditure for the tax period less your taxable interest income. Interest is defined broadly under the corporate-tax law: it includes not only bank and loan interest but amounts economically equivalent to interest, such as the finance element of certain instruments and payments. Getting the definition right decides whether the 30% cap and de-minimis apply.
Exiloz Management & Tax Consultant · Dubai-based FTA-focused advisory · VAT, corporate tax & accounting
Expense minus income
It is a net figure for the period.
- Start with interest expenditure for the period.
- Deduct taxable interest income.
- The result is Net Interest Expenditure.
- This is what the cap applies to.
More than bank loans
The definition reaches wider than you think.
- Bank and loan interest.
- Amounts economically equivalent to interest.
- Finance elements of certain payments.
- Review all financing arrangements.
Related guides
Frequently Asked Questions
For measuring the figure correctly.
Is only bank interest counted?
No. Interest is defined broadly to include amounts economically equivalent to interest, not just bank loans.
Do I net off interest income?
Yes. Net Interest Expenditure is interest expenditure less taxable interest income.
Why does the definition matter?
It determines whether your net interest exceeds AED 12m and how much is subject to the 30% cap.
Can Exiloz compute the figure?
Yes. We identify all in-scope interest and calculate your net figure.
Measure your net interest
Exiloz identifies all in-scope interest and computes your net figure for the cap.