Retail trade, except of motor vehicles and motorcycles

Retail trade (ISIC 47) is categorized as an Excluded Activity under the UAE Corporate Tax framework when transactions are conducted with natural persons. Even if the entity is a Qualifying Free Zone Person, income from retail trade is subject to the 9% headline rate. Forensic auditors will scrutinize the 'Natural Person' test and the 'De Minimis' threshold (lower of 5% of total revenue or AED 5 million) to ensure the entity hasn't lost its QFZP status entirely.

Audit Red Flag

Misclassification of B2C retail transactions as B2B wholesale 'Qualifying Commodities' to illicitly apply the 0% regime.

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