Qatar's Income Tax Law exempts a number of income categories from tax, most notably the gross income of resident Qatari natural persons, bank interest earned by individuals, capital gains arising from natural persons' disposal of their personal real estate and securities, income of small handicraft activities whose gross income does not exceed 200,000 QAR a year and whose workforce does not exceed 3 workers, as well as agriculture and sea fishing income and the non-Qatari investor's share in the financial markets.
The Gross Income of Resident Qatari Individuals
The law fully exempts the gross income of resident Qatari natural persons in the state, regardless of the type of activity or the source of that income. This exemption is distinct from the exemption for personal capital gains discussed below, since it covers the individual's entire gross income rather than only capital gains from an occasional disposal of real estate or securities.
Public-Benefit Associations and Private Institutions
The law exempts from income tax the income of associations and private institutions, charitable private associations and institutions, and private institutions of public benefit, established under the law governing each of them.
Bank Interest and Interest on Public Debt Instruments
The law exempts bank interest and returns due to natural persons who do not carry out a taxable activity in the state, whether resident or non-resident. It also exempts interest and returns on public debt instruments and Islamic financial instruments issued under the state's financial system law, and bonds of public authorities and institutions.
Capital Gains of Natural Persons
Capital gains arising from the disposal of real estate or securities realized by natural persons are exempt, provided that the disposed real estate or securities are not assets of a taxable activity. The exemption therefore remains tied to the personal, non-business nature of the disposal.
Small Handicraft Activities: a 200,000 QAR and 3-Worker Threshold
The law exempts gross income arising from handicraft activities that do not use machinery, provided that their gross income does not exceed 200,000 QAR a year, that the average number of their workers during the tax year does not exceed 3 workers, and that the activity is carried out through a single establishment. The Council of Ministers, upon the Minister of Finance's proposal, may amend the conditions of this exemption.
Agriculture, Sea Fishing, and Reciprocal Foreign Shipping
Gross income arising from agriculture or sea fishing activities is exempt from tax. Gross income realized in the state by non-Qatari air or sea navigation companies operating there is also exempt, on condition of reciprocal treatment with their home state.
The Non-Qatari Investor's Share in the Financial Markets
The law exempts the non-Qatari investor's share in the profits of companies whose shares are traded on the financial markets, their share in the profits of investment funds whose units are traded, and their share in profits arising from trading in all listed securities, including units of listed investment funds.
A General Note on Exemption Conditions
The executive regulations determine the conditions and controls for exempting this income from tax. Under the law's promulgation articles, tax exemptions in effect on the date this law takes effect continue to apply until their specified term ends, without prejudice to exemptions granted under special laws or international agreements.
Legal References
- Law No. (24) of 2018 Promulgating the Income Tax Law — Article 4 (Promulgation Articles)
- Law No. (24) of 2018 Promulgating the Income Tax Law — Article 4/1
- Law No. (24) of 2018 Promulgating the Income Tax Law — Article 4/2
- Law No. (24) of 2018 Promulgating the Income Tax Law — Article 4/3
- Law No. (24) of 2018 Promulgating the Income Tax Law — Article 4/4
- Law No. (24) of 2018 Promulgating the Income Tax Law — Article 4/9
- Law No. (24) of 2018 Promulgating the Income Tax Law — Article 4/10
- Law No. (24) of 2018 Promulgating the Income Tax Law — Article 4/11
- Law No. (24) of 2018 Promulgating the Income Tax Law — Article 4/12
- Law No. (24) of 2018 Promulgating the Income Tax Law — Article 4/16
- Law No. (24) of 2018 Promulgating the Income Tax Law — Article 4/17
- Law No. (24) of 2018 Promulgating the Income Tax Law — Article 4/18
For questions about your specific situation, you can ask the Qatar Tax & Legislation Helper on Helpers, or consult a licensed chartered accountant.