Family Office in Abu Dhabi (ADGM)

Tax regime

ADGM sits within a UAE free zone that levies no corporate income tax on qualifying family-office entities, no capital gains tax, no withholding tax on dividends or interest, and no personal income tax on principals or employees. The UAE introduced a federal Corporate Tax at 9% effective June 2023 for businesses with taxable income above AED 375,000, but 'Qualifying Free Zone Persons' that meet substance and income-source conditions can elect a 0% rate on qualifying income. Family offices structured as holding or pure investment vehicles, earning dividends, capital gains, and passive income, typically fall within the qualifying-income categories, though each structure must be reviewed against Cabinet and Ministerial Decisions implementing the CT Law.

The UAE has an extensive and growing double-tax-treaty network (over 130 treaties in force). While a pure family-office holding entity may have limited treaty access depending on its activities, the network adds planning optionality for structures that include operating or trading subsidiaries. There is no inheritance or gift tax at the federal or emirate level, no stamp duty on share transfers within ADGM, and no exchange controls. Collectively, this makes ADGM one of the most tax-efficient domiciles globally for high-net-worth families consolidating international assets.

Key regulations

• Financial Services and Markets Regulations 2015 (FSMR)

  Primary ADGM legislation governing regulated activities; MFOs managing third-party family assets require authorisation under FSMR.

• ADGM Family Office Framework (FSRA Guidance)

  Dedicated FSRA framework distinguishing SFO (non-regulated registration) from MFO (licensed), with eligibility criteria and ongoing obligations.

• UAE Federal Corporate Tax Law (Federal Decree-Law No. 47 of 2022)

  Introduces 9% CT from June 2023; Qualifying Free Zone Persons electing 0% on qualifying income must satisfy substance and non-qualifying income tests.

  Effective June 2023

• ADGM Commercial Licensing Regulations

  Governs incorporation and ongoing registration of entities (including non-regulated SFOs) with ADGM Registration Authority.

• UAE AML/CFT Federal Decree-Law No. 20 of 2018 (as amended)

  Federal anti-money-laundering framework applicable to ADGM entities; FSRA-supervised firms must maintain robust AML programmes.

Substance & residency

The ADGM Financial Services Regulatory Authority (FSRA) operates a dedicated Family Office framework (introduced 2020, updated subsequently) that distinguishes between a Single Family Office (SFO) and a Multi-Family Office (MFO). An SFO serving one family and not offering services to the public is treated as a non-regulated entity but must register with ADGM Registration Authority and satisfy minimum qualifying criteria, including a minimum net assets threshold for the family (currently set at USD 10 million, though advisors should verify the current threshold with the FSRA directly). The SFO entity itself must be incorporated and registered in ADGM, must maintain a physical presence, at minimum a registered address and, in practice, demonstrable operational activity, on Al Maryah Island.

An MFO serving more than one family requires a full FSRA licence under the Financial Services and Markets Regulations 2015 (FSMR) as it is deemed to be conducting a regulated activity (managing investments or arranging deals). Accordingly, MFOs must appoint approved individuals in controlled functions (e.g., a Senior Executive Officer, Compliance Officer, Finance Officer), maintain adequate capital (determined by the FSRA based on the scope of regulated activities), and implement ADGM-compliant compliance and AML/CFT frameworks. Both SFO and MFO structures must maintain genuine ADGM-based operations; the FSRA and ADGM RA conduct periodic reviews and the UAE's FATF-driven AML framework demands demonstrable substance, not merely a brass-plate presence.