What is Adequate substance?
Free Zone Person must maintain adequate substance in a Free Zone (or in a Designated Zone for the Qualifying Activity of distribution) throughout that Tax Period. This requires the Free Zone Person to:
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undertake the core income-generating activities for that Business in the Free Zone (or Designated Zone for the Qualifying Activity of distribution), and
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maintain adequate assets and qualified full-time employees, and incur an adequate amount of operating expenditures in relation to each of those core income-generating activities within the Free Zone (or Designated Zone)