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The UAE Ministry of Finance issued Ministerial Decision No. 336 of 2025, which adds the Virtual Assets Regulatory Authority to the definition of competent authority within Ministerial Decision No. 229 of 2025 on qualifying and excluded activities. The update applies to the framework established by Federal Decree-Law No. 47 of 2022 on the taxation of corporations and businesses. VARA was established under Dubai Law No. 4 of 2022, and the designation covers qualifying activities linked to fund management, wealth management and investment management services.
The Ministry of Finance stated that the decision formed part of efforts to enhance clarity, certainty and regulatory alignment across the UAE’s financial system. This step supports the country’s strategic position as a global investment and financial hub. The recognition brings virtual asset supervision in line with the broader corporate tax requirements for entities seeking preferential treatment.
PwC tax summaries indicate that the UAE corporate tax applies a 9 percent rate on taxable income above 375,000 dirhams while providing a 0 percent rate on qualifying income from qualifying activities for free zone persons that meet all conditions. Qualifying activities include fund, wealth and investment management services when conducted with certain counterparties rather than natural persons in many cases. The addition of VARA as competent authority allows licensed virtual asset entities in Dubai to satisfy the regulatory oversight element for such tax treatment.
VARA rulebooks state that the authority regulates virtual asset service providers across Dubai, excluding the DIFC, and covers activities such as advisory services, asset management, exchange operations, custody and brokerage. The regulator has released multiple activity-specific rulebooks since its inception to set standards for compliance, risk management and investor protection. Recent adjustments to those regulations have addressed areas including margin trading and token distribution services.
Chambers and Partners guides reported that Cabinet Decision No. 34 of 2025 refined the exempt person regime for qualifying investment funds, real estate investment trusts and limited partnerships with updated conditions on regulatory oversight, ownership and diversification. The corporate tax law took effect for financial years beginning on or after June 1, 2023, following its introduction in 2022. The VARA designation integrates the virtual assets framework into this evolving tax structure for relevant management services.
A tax alert from Invest in Dubai noted that a VARA license enables eligible businesses to apply the 0 percent corporate tax rate on qualifying income derived from the specified activities in designated zones. Entities must still fulfill substance, income and other qualifying tests to secure the benefit. The measure forms part of ongoing coordination between financial regulators and tax authorities to support sector growth while upholding compliance standards.
