Donations & Charitable Contributions (Article 21)
The Rule
Donations are deductible only if made to:
- A qualifying public benefit entity (listed in Cabinet Decision No. 37 of 2023), OR
- An entity approved by the competent authority
Non-Qualifying Donations
Donations to non-qualifying entities (e.g., foreign charities not approved, political parties, unregistered entities) are non-deductible.
Qualifying Public Benefit Entities
These are entities listed by the Cabinet as public benefit organisations, including:
- Approved UAE charities
- Religious organisations
- Educational institutions
- Social development entities
Documentation
To claim a deduction:
- Obtain a receipt from the qualifying entity
- Verify the entity is on the Cabinet list
- Record the donation in the accounts
Example
Donation to approved UAE charity: AED 50,000 → Deductible
Donation to foreign charity: AED 20,000 → Non-deductible
Sponsorships
Sponsorships that provide a business benefit (advertising) may be deductible as a marketing expense, not a donation.