MOF issued Cabinet Decision No. 126 on General Interest Deduction Limitation Rule states:
- If the Net Interest Expenditure for the relevant Tax Period is upto AED 12 Mn then the General Interest Deduction Limitation Rule will not apply.
- If the Net Interest Expenditure for the relevant Tax Period exceed AED 12 Mn then a Taxable Person may deduct higher of 30% of EBITDA or a safe harbour amount of AED 12 Mn.
- Furthermore, amounts incurred in connection with raising finance are considered interest. These include guarantee fees, arrangement fees and commitment fees, and any other similar fees.