Article (5)
Qualifying Limited Partnerships
1. A Qualifying Limited Partnership may apply to the Authority for exemption from
corporate tax if all of the following conditions are met:
a. The primary business or business activities carried on by the Qualifying Limited
Partnership are investment businesses, and any other business or business activities
carried on by the Qualifying Limited Partnership are ancillary or incidental to the
investment business.
b. The Qualifying Limited Partnership shall not generate any income from a right in rem
in immovable property located in the State and from the sale, disposal, assignment of
rights therein, direct use, leasing including subletting, or any other form of
exploitation.
c. The main or primary purpose of the Qualifying Limited Partnership is not to avoid
corporate tax.
2. A legal person that is wholly owned and wholly controlled, directly or indirectly, by a
Qualifying Limited Partnership that is exempt from corporate tax may apply to the
Authority for exemption from corporate tax if it meets the following two conditions:
a. engages in any of the following activities:
1. Exclusively carry out all or part of the Qualifying Limited Partnership activity.
2. Exclusively holding assets or investing funds for the benefit of the Qualifying
Limited Partnership.
3. Exclusively carrying out activities ancillary to the activities carried out by the
Qualifying Limited Partnership.
b. It shall not derive any income from a right in rem in immovable property located in the
State and from its sale, disposal, assignment of rights therein, direct use, leasing
including subletting and or any other form of exploitation.
3. For the purposes of the application of Paragraph (a) of Clause (1) of this Article, the
following provisions shall apply:
a. Where the business or business activities of a Resident Investment Manager are
attributable to a Qualifying Limited Partnership, the taxable income of the Investment
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Cabinet Resolution of 2025 Regarding Qualifying Investment Funds and Qualifying Limited Partnerships for
the Purposes of Federal Decree by Law of 2022 Regarding Taxation of Corporations and Business 11
Manager shall be adjusted to include the net income attributable to the Qualifying
Limited Partnership for such business or business activities in accordance with the
provisions of Article (20) of the Corporate Tax Law.
b. The business or business activities of the Investment Manager attributable to the
Qualifying Limited Partnership shall be deemed to be an Investment Business if one or
both of the following conditions are met:
1. They are subject to corporate tax in the State through the Investment Manager.
2. It is conducted by an Investment Manager that meets the requirements set forth in
clause (1) of Article (15) of the Corporate Tax Law, provided that any reference
therein to "Qualifying Limited Partnership" shall be read as reference to "Non-
Resident Person."
4. Any other business or business activities carried on by the Qualifying Limited Partnership
shall be deemed to be ancillary or incidental to the Investment Business if the combined
revenues of such business or business activities do not exceed five percent (5%) of the
total revenues of the Qualifying Limited Partnership in the relevant fiscal year.
5. The Taxable Income of a Taxable Person who is an investor in a Qualifying Limited
Partnership that is exempt from corporate tax shall be adjusted to exclude any dividends
received from the Qualifying Limited Partnership.
6. Without prejudice to clause (5) of this Article and Article (22) of the Corporate Tax Law,
the Taxable Income of a legal person who is an investor in a Qualifying Limited Partnership
exempt from corporate tax for the relevant Tax Period shall be adjusted to proportionately
include the net income of both the Qualifying Limited Partnership and any legal person
exempt from corporate tax that is wholly owned and wholly controlled, directly or
indirectly, by the Qualifying Limited Partnership, as recorded in the financial statements,
in proportion to the investor's ownership interest, after deducting the income attributable
to the Investment Manager under Paragraph (a) of Clause (3) of this Article, in accordance
with Article (20) of the Corporate Tax Law.
7. If the investor in a Qualifying Limited Partnership exempt from corporate tax is a Non-
Resident Person, it may, directly or through the Qualifying Limited Partnership or the
Investment Manager of the Partnership, appoint a Tax Agent to act on its behalf with
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Cabinet Resolution of 2025 Regarding Qualifying Investment Funds and Qualifying Limited Partnerships for
the Purposes of Federal Decree by Law of 2022 Regarding Taxation of Corporations and Business 12
respect to its obligations in accordance with the provisions of Federal Decree by Law No.
(28) of 2022.
8. If a Qualifying Limited Partnership does not apply to the Authority for exemption from
Corporate Tax during the first Tax Period to which this Resolution applies or fail to meet
any of the conditions stipulated in Clause (1) of this Article throughout the Tax Period, it
shall cease to be treated as an Exempt Person as a Qualifying Limited Partnership from the
beginning of the relevant Tax Period and for the four (4) subsequent Tax Periods.
9. If a Qualifying Limited Partnership ceases to be treated as an Exempt Person under Clause
(8) of this Resolution, its opening values for Corporation Tax purposes shall be as follows:
a. For assets and liabilities that were held prior to the first Tax Period in which the
Qualifying Limited Partnership became an Exempt Person and continued to be held at
the beginning of that Tax Period, the opening values shall be those in the closing
balance sheet prepared for financial reporting purposes in accordance with applicable
accounting standards as of the last day of the fiscal year ending immediately prior to
the first Tax Period in which it became an Exempt Person and any subsequent
capitalized costs incurred during the Tax Period(s) in which it was treated as an Exempt
Person, taking into account the arm’s length principle and any conditions or
adjustments as may be prescribed by the Minister.
b. For assets and liabilities acquired during the Tax Period(s) in which the Qualifying
Limited Partnership was treated as an Exempt Person, the opening values shall be the
"cost" as defined in the applicable accounting standards in the State, and any
subsequent capitalized costs incurred during that period taking into account the arm's
length principle.
10. A Qualifying Limited Partnership that has not applied to the Authority for exemption from
Corporate Tax under Clause (1) of this Article or has failed to meet any of the conditions
in that Clause throughout the relevant Tax Period and has ceased to be treated as an
Exempt Person, may apply to the Authority for exemption from Corporate Tax in
accordance with any other exemptions under the Corporate Tax Law.
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Cabinet Resolution of 2025 Regarding Qualifying Investment Funds and Qualifying Limited Partnerships for
the Purposes of Federal Decree by Law of 2022 Regarding Taxation of Corporations and Business 13
11. Clauses (8) to (10) of this Article shall apply to the legal person referred to in Clause (2) of
this Article and the reference to Clause (1) in Clauses (8) and (10) shall be replaced by the
reference to Clause (2).
