ADGM company accounting for holding companies, SPVs and advisers

An ADGM holding company might own shares in three operating companies, receive dividends twice a year, lend to one subsidiary and pay a handful of fees. That is few transactions, but each one has tax weight. The FTA guide lists holding of shares and other securities for investment purposes, and treasury and financing services to related parties, among qualifying activities, with conditions set out in Ministerial Decision No. 265 of 2023.

On the Business plan, HelloBooks runs each SPV as its own entity. Intercompany loans are posted in both sets of books, interest is accrued with recurring journals, and the consolidated view shows the family or group position. The AI agent reads bank statements from each entity and matches dividend receipts and loan drawdowns.

• One entity per SPV, with its own chart of accounts and reports
• Intercompany balances that agree across entities
• Recurring journals for interest accruals and management fees

Even a quiet holding company needs adequate substance in the zone if it wants to be a qualifying free zone person. The FTA guide describes this as carrying out core income-generating activities in the free zone with adequate assets, full-time employees and operating expenditure, with outsourcing allowed under conditions.

It also needs audited financial statements whatever its size, arm's length pricing on related-party loans, and transfer pricing documentation. If any condition fails, it ceases to qualify for that period and the four after it. Getting the books right is the cheap part; the substance and documentation are where advice is needed.

Consider an ADGM-licensed wealth adviser earning AED 3.2 million. The FTA guide lists wealth management as a qualifying activity, subject to conditions including regulatory status, and lists transactions with natural persons as normally excluded. Advice paid for by individuals rather than their holding structures can therefore fall outside qualifying income. With a de minimis cap of AED 160,000 (5% of AED 3.2 million), the client mix becomes the deciding factor.

The AI tags each invoice by who is paying: an individual, a family company, a fund or a related party. The partner sees the running non-qualifying total before signing a new mandate. Custom income categories, invoice templates or approval steps can be set up for your firm by booking a call at /book-a-demo or emailing hello@hellobooks.ai.