Activities of holding companies

Under the UAE CT framework, holding shares and other securities is a Qualifying Activity. Forensic scrutiny focuses on the 'Adequate Substance' test, ensuring the entity has sufficient personnel and assets in the Free Zone to manage the holdings, and that it does not engage in 'Excluded Activities' such as banking or insurance without the requisite licensing and tax adjustments.

Audit Red Flag

Misclassification of interest income from commercial lending or active treasury management as passive 'holding' income to bypass Excluded Activity thresholds.

Which UAE zones permit this activity?

Scout checks the current permission status for this activity across every UAE zone against your specific structure.