Computer programming, consultancy and related activities

Under the UAE CT regime, software development is treated as Qualifying Intellectual Property. Income derived from such IP is qualifying only if the Nexus Approach calculation (R&D expenditure) is satisfied. Conversely, general IT consultancy (ISIC 6202) is often an 'Excluded Activity' when provided to mainland persons or non-Free Zone entities, creating a high risk of commingling qualifying and non-qualifying revenue streams.

Audit Red Flag

Re-characterizing non-qualifying 'IT Consultancy' service fees as qualifying 'Software Royalty' or 'IP Licensing' income to exploit the 0% rate.

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