UAE Cabinet Decision Exempts Certain Sports Entities from Corporate Income Tax

The MoF (Ministry of Finance) has issued Cabinet Decision No. (1) of 2026, which exempts specific sports entities from CIT (Corporate Income Tax) under Federal Decree-Law No. 47 of 2022 on the Taxation of Corporations and Businesses. This is a targeted measure designed to support the growth of organised sport across the UAE while keeping strict controls on which entities qualify.

For business owners, investors, and professionals connected to the sports sector, this decision introduces a clear framework worth understanding.

What the Decision Covers

The exemption applies to three categories of entities: International Sports Entities, Sports Entities, and Ancillary Entities that support them. To fall within scope, an entity must operate on a non-commercial basis and have a primary objective tied to the promotion, management, or development of one or more sports at the international or regional level. It must also be responsible for organising or coordinating those sports and be formally recognised by the Ministry of Sports or a competent sports authority in the UAE.

Key Conditions for Eligibility

The decision sets out strict requirements that qualifying entities must meet.

The entity must not carry out any business or commercial activity outside its principal sporting objective. All income and assets must be used exclusively to serve that objective or to cover necessary and reasonable expenses related to it.

Additionally, no portion of the entity’s income or assets may be directed toward the personal benefit of any shareholder, member, trustee, founder, or settlor. There is one exception: distributions are permitted where the beneficiary is a qualifying public benefit entity, a government entity, a government-related entity, or another approved sports entity.

These conditions are designed to ensure that the exemption supports genuine non-profit sporting operations rather than creating a route for tax-free commercial activity.

Application Process Through the FTA

Sports entities that believe they qualify must submit a formal application to the FTA (Federal Tax Authority). The application must include all necessary supporting documents, data, and information so the FTA can verify eligibility.

This is not an automatic exemption. Entities must apply, provide evidence, and receive approval before they can benefit from the tax-exempt status.

What Businesses and Professionals Should Consider

If you are involved with a sports federation, association, or supporting entity in the UAE, it is worth reviewing whether your organisation meets the criteria set out in this decision. The conditions around non-commercial operations, use of income, and formal recognition by a competent authority are specific and will require careful assessment.

For entities that do qualify, the exemption provides meaningful tax relief. For those that do not, the decision serves as a clear boundary between non-profit sporting bodies and commercial sports businesses, which remain subject to the standard CIT framework.