Small Business Relief is a Corporate Tax relief available to eligible UAE resident persons that meet the prescribed revenue conditions.

The Federal Tax Authority states that eligible resident persons can elect for Small Business Relief where their revenue is AED 3 million or less in the relevant Tax Period and each previous Tax Period, subject to the applicable rules.

Where the relief applies, the taxable person is treated as having no taxable income for the relevant Tax Period, subject to the conditions of the regime.

Who Can Benefit?

Small Business Relief is subject to eligibility requirements. Businesses should not assume that simply having revenue below AED 3 million automatically qualifies them.

The rules include conditions relating to the business’s residency, revenue and previous Tax Periods.

Certain businesses are specifically excluded, including Qualifying Free Zone Persons and members of certain multinational enterprise groups meeting the applicable criteria.

Our Small Business Relief Services

KBA can assist with:

• Small Business Relief eligibility assessment
• Revenue threshold assessment
• Review of previous Tax Periods
• Review of business structure
• Free Zone status assessment
• MNE group considerations
• Small Business Relief election guidance
• Corporate Tax Return support
• Accounting and record-keeping guidance
• Compliance review
• Ongoing Corporate Tax advisory

Why Professional Assessment is Important

Eligibility for Small Business Relief depends on the specific circumstances of the business. Revenue should be assessed using the applicable accounting standards and the relevant Corporate Tax rules.

The AED 3 million threshold is not simply a tax-free profit threshold; it is a revenue-based eligibility condition for the relief. Businesses should therefore distinguish between revenue, accounting profit and taxable income.

The FTA also confirms that businesses claiming Small Business Relief are not required to comply with the Transfer Pricing documentation rules, although the arm’s length principle continues to apply where relevant.

Let KBA Assess Your Eligibility

Choosing the correct Corporate Tax treatment can help eligible small businesses manage their compliance obligations effectively. However, an incorrect election or misunderstanding of the eligibility conditions can create compliance issues.

Our team can review your business information and help determine whether Small Business Relief may be available based on the applicable rules.

Contact KBA Accounting Services today for professional Small Business Relief and UAE Corporate Tax guidance.