The UAE Ministry of Finance has published Cabinet Decision No. 56 of 2023 on the determination of a non-resident person's nexus in the UAE for the purpose of the new Corporate Tax Law. Under Article 11 of the Corporate Tax Law, a non-resident person is considered a taxable person if certain conditions are met, including where the non-resident has a nexus in the UAE as specified in a decision issued by the Cabinet.

As provided by Cabinet Decision No. 56, any juridical person (corporate entity) that is a non-resident person is considered to have a nexus in the UAE if it earns income from any immovable property in the UAE. Immovable property means any of the following:

• Any area of land over which rights or interests or services can be created;
• Any building, structure, or engineering work attached to the land permanently or attached to the seabed; and
• Any fixture or equipment which makes up a permanent part of the land or is permanently attached to the building, structure, or engineering work or attached to the seabed.

For the purposes of determining the tax base of a non-resident person, taxable income that is attributable to immovable property in the UAE shall include income derived from the right in rem (right to), sale, disposal, assignment, direct use, letting, including subletting, and any other form of exploitation of immovable property.

Cabinet Decision No. 56 also provides that if a non-resident person artificially transfers or otherwise disposes of its right in rem in any immovable property in the UAE to another person, and that transfer or disposal is not for a valid commercial or other non-fiscal reason which reflects economic reality, then this would be considered an arrangement to obtain a corporate tax advantage under Article 50 (General Anti-Abuse Rule) of the Corporate Tax Law. Lastly, Cabinet Decision No. 56 provides that a non-resident person that has a nexus in the UAE in accordance with the decision shall be required to register with the authority in accordance with Article 51 (Tax Registration) of the Corporate Tax Law.