Aldar has welcomed the UAE Ministry of Finance’s latest Ministerial Decision on Depreciation Adjustments for Investment Properties held at Fair Value, calling it a positive step for the real estate sector.
Aldar, a leading real estate developer, manager, and investor in Abu Dhabi, has backed the amendment issued under Federal Decree Law No. (47) of 2022 on the Taxation of Corporations and Businesses. The decision enables taxpayers opting for the realization basis to deduct tax depreciation from their taxable income for investment properties assessed at fair value.
The Ministry’s decision ensures tax neutrality between businesses that account for investment properties at fair value and those using historical cost. Under the new rule, the deductible depreciation amount will be the lower of the tax written down value or 4 percent of the original property cost for each 12 month tax period, or prorated for shorter periods.
It also offers clarity on tax depreciation treatment in cases involving property transfers, whether between related or third parties, as well as development scenarios and claw back conditions. These provisions aim to help businesses better understand their tax obligations and strengthen financial planning.
Faisal Falaknaz, Group Chief Financial and Sustainability Officer at Aldar, praised the move and stated that, “Aldar expresses its gratitude for the UAE Ministry of Finance for this progressive and well calibrated step, which reflects a deep commitment to fairness, clarity, and international best practices in the implementation of the Corporate Tax Law.”
Faisal Falaknaz Group Chief Financial and Sustainability Officer- Aldar
“By enabling depreciation deductions for investment properties held at fair value, this decision creates parity between different accounting treatments, helping companies plan long term capital deployment more effectively. It will also reinforce investor confidence, attract institutional capital, and enhance the UAE’s standing as a transparent, competitive, and globally integrated investment destination, particularly for the real estate sector.”
Aldar operates through two main divisions: Aldar Development and Aldar Investment. Aldar Investment manages a diversified portfolio of income generating assets spanning commercial, residential, retail, and logistics sectors. As of 31 December 2024, the portfolio had a gross asset value of $7.02 billion (AED 25.8 billion) and generated EBITDA of $681.7 million (AED 2.5 billion) in 2024.
