FTA Introduces New Application For Family Foundations As Unincorporated Partnerships Via EmaraTax

The Federal Tax Authority (FTA) has launched a new feature on the "EmaraTax" digital platform. This allows eligible Family Foundations to apply for recognition as an Unincorporated Partnership. This status is contingent upon meeting criteria outlined in Federal Decree-Law No. 47 of 2022 regarding Corporate and Business Taxation.

Family Foundations can qualify as Unincorporated Partnerships for Corporate Tax purposes if they comply with Ministerial Decision No. 261 of 2024. This decision pertains to Unincorporated Partnerships, Foreign Partnerships, and Family Foundations under Federal Decree-Law No. 47 of 2022. The FTA aims to enhance its services by aligning with international standards, providing comprehensive support to businesses, and ensuring smooth compliance with the Corporate Tax Law.

To be considered as an Unincorporated Partnership, Family Foundations must already be registered for Corporate Tax. The FTA clarified that applications can be submitted by the taxpayer, their Tax Agent, or their legal representative. Once approved, the Family Foundation will not need to file Corporate Tax Returns anymore.

Individual beneficiaries of these foundations must assess whether they need to register for Corporate Tax themselves. They are responsible for submitting their own Corporate Tax Returns for the relevant tax period if required.

Applicants must ensure they meet specific conditions according to the Corporate Tax Law and related legislation available on the FTA’s website. This step is crucial before applying for the Unincorporated Partnership status.

The FTA's initiative reflects its commitment to improving service delivery in line with global best practices. By facilitating accurate compliance with tax laws and procedures, it aims to provide robust support to the business sector in the UAE.

With inputs from WAM