5 July 2026 · Income test
What Counts as Qualifying Income
Qualifying income is the revenue a free-zone company earns that meets the FTA criteria for the 0% rate — typically income from approved qualifying activities and transactions with other free-zone entities, plus incidental income that meets the conditions. Non-qualifying income is taxed at 9% and, if it exceeds the de minimis limit, can cost you QFZP status entirely.
Exiloz Management & Tax Consultant · Dubai-based FTA-focused advisory · VAT, corporate tax & accounting
Income that supports 0%
It centres on approved activities and free-zone dealings.
- Income from FTA-recognised qualifying activities.
- Transactions with other free-zone persons (subject to conditions).
- Incidental income that meets the relevant conditions.
- Correctly documented and substantiated revenue.
The income that risks your rate
Non-qualifying income is where status is lost.
- Excluded activities and certain mainland-source income.
- Non-qualifying income is taxed at 9%.
- If it breaches the de minimis limit, QFZP status is lost for the period.
- Then 9% applies to all taxable income, not just the excess.
Related guides
Frequently Asked Questions
For free-zone companies classifying their revenue.
What is qualifying income?
Revenue meeting the FTA criteria for the 0% rate — typically from qualifying activities and transactions with other free-zone entities, plus qualifying incidental income.
Is all free-zone income taxed at 0%?
No. Only qualifying income; non-qualifying income is taxed at 9% and can jeopardise QFZP status if it exceeds the de minimis limit.
How do I know which is which?
It requires mapping your revenue streams to the qualifying-activity rules — Exiloz does this classification for you.
Can Exiloz classify our income?
Yes. We split qualifying vs non-qualifying income and check it against the de minimis limit.
Classify your free-zone income correctly
Exiloz maps qualifying vs non-qualifying income so your 0% rate holds up.