What is a Family Foundation in the UAE Corporate Tax Framework?

 In the UAE, natural persons often establish special structures to manage their wealth, protect assets, and plan for succession. Common vehicles include contractual trusts, private trust companies, and family foundations, which are used to hold and manage personal assets and investments.



Legal Personality of Family Foundations

Unlike informal arrangements, trusts and foundations are recognized as having separate legal personality. This means that, in principle, a foundation is treated as an independent juridical person. As such, it is prima facie subject to Corporate Tax in Dubai in its own right under UAE law.

Corporate Tax Treatment

  • Some wealth management structures may be treated as transparent for Corporate Tax purposes.
  • However, a family foundation, being a juridical person, would normally be liable for Corporate Tax just like a company.

Application for Transparent Treatment

Under the UAE Corporate Tax regime, a family foundation can apply to the Federal Tax Authority (FTA) to be treated as an unincorporated partnership.

  • If the application is approved, the family foundation would not be taxed in its own right.
  • Instead, the foundation would be treated on a look-through basis, with tax liability attributed to the underlying beneficiaries or founders.

Disclaimer

This blog is published by Fuad House Tax & Management Consultancy for informational purposes only. It does not constitute professional tax advice and should not replace a tailored consultation. Corporate Tax implications vary depending on your business structure, sector, and whether you operate in a Free Zone or mainland. For personalized, reliable guidance, please contact a qualified UAE tax consultant.

 

Location: Dubai - United Arab Emirates

Comments

  1. NitaNovember 26, 2025 at 9:14 PM

    Great post! It provides a clear explanation of what a family foundation is within the UAE corporate tax framework. Understanding how these structures fit into corporate tax services in UAE is essential for effective wealth management and compliance. Thanks for sharing such valuable insights!

    ReplyDelete

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