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UAE Corporate Tax Fundamentals/Deductible Expenses (General)
5 min

General Deductibility Rules

The general test for expense deductibility under Article 28.

General Deductibility Rules (Article 28)

The General Test

An expense is deductible if it is:

  1. Wholly and exclusively incurred for business purposes
  2. Not specifically non-deductible under Article 29
  3. Actually incurred (not estimated or contingent)

Wholly and Exclusively Test

The expense must be incurred solely for business purposes. If an expense has a dual purpose (business and private), it is generally non-deductible unless the business portion can be separately identified.

Examples

  • ✅ Office rent — fully deductible
  • ✅ Employee salaries — fully deductible
  • ✅ Raw materials — fully deductible
  • ❌ Personal expenses — non-deductible
  • ❌ Fines — non-deductible (Article 29)

Key takeaways

  • Expenses must be wholly and exclusively for business
  • Dual-purpose expenses are non-deductible
  • Article 29 lists specific non-deductible items
Knowledge check

1. What is the general test for expense deductibility under Article 28?

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This lesson is general educational content, not individualized tax or legal advice. Always consult a qualified professional for your specific situation.