Key takeaways
- UAE Small Business Relief is still available after 2026: Ministerial Decision No. 131 of 2026 extended it to tax periods that end on or before 31 December 2029, as announced by the Ministry of Finance on 7 August 2026.
- The revenue limit for UAE Small Business Relief has not changed: AED 3,000,000 or less in the current tax period and in every previous tax period.
- Qualifying Free Zone Persons and constituent companies of multinational enterprise groups cannot elect UAE Small Business Relief, whatever their revenue.
- A company that elects UAE Small Business Relief is treated as having no taxable income for that period, but it must still register for corporate tax and file a return.
- Electing UAE Small Business Relief means losing the carry-forward of that period's tax losses and net interest expenditure, so a loss-making start-up can be better off not electing.
Is Small Business Relief still available after 2026?
Yes. Ministerial Decision No. 131 of 2026 amends Article 2(2) of Ministerial Decision No. 73 of 2023 so that the AED 3,000,000 threshold keeps applying to tax periods ending on or before 31 December 2029. Before the amendment, the cut-off was periods ending on or before 31 December 2026.
| Instrument | What it does | Tax periods covered |
|---|---|---|
| Ministerial Decision No. 73 of 2023 | Sets the AED 3,000,000 revenue threshold | Periods starting on or after 1 June 2023 and ending on or before 31 December 2026 |
| Ministerial Decision No. 131 of 2026 (dated 29 July 2026; announced 7 August 2026) | Amends Article 2(2) of Decision No. 73 | The same threshold continues for periods ending on or before 31 December 2029 |
Status as of 28 October 2026. We found no announcement of anything beyond 2029, so planning past that date should assume the relief may not continue.
What exactly did Ministerial Decision No. 131 of 2026 change?
Ministerial Decision No. 131 of 2026 changed one thing: the end date. It replaced the 31 December 2026 cut-off in Article 2(2) of Decision No. 73 with 31 December 2029, and the Ministry of Finance's published text touches no other clause.
The AED 3,000,000 figure, the exclusions and the other conditions stay as they were. The Decision takes effect the day after its publication; the text itself doesn't state the publication date, so check the Ministry of Finance site if the exact start matters for a filing you're preparing.
Who can use Small Business Relief now?
A Resident Person, whether a natural person or a juridical person, can elect Small Business Relief if its revenue stays at or below AED 3,000,000 and it isn't in an excluded group. The FTA lists the conditions on its Small Business Relief page; Ministerial Decision No. 73 of 2023 sets them in law.
- Revenue: AED 3,000,000 or less in the relevant tax period and in all previous tax periods, measured under the accounting standards accepted in the UAE.
- Residence: the person must be a Resident Person.
- Not a Qualifying Free Zone Person: a company that qualifies for the free zone regime can't elect the relief.
- Not a multinational group member: constituent companies of a multinational enterprise group, as defined in Cabinet Decision No. 44 of 2020, are excluded. The FTA describes this as groups with consolidated revenue above AED 3.15 billion.
The look-back matters. The FTA's own example is a company with AED 4,300,000 of revenue in 2025: it can't use the relief for 2026 even if 2026 revenue is only AED 1,900,000, because an earlier period exceeded the limit.
What do you give up by electing Small Business Relief?
You give up loss and interest carry-forwards for the elected period, and you can't combine the relief with other reliefs or deductions. The relief treats you as having no taxable income, so there's nothing for those items to offset.
| Item | Treatment in an elected period | Source |
|---|---|---|
| Taxable income | Treated as nil | FTA Small Business Relief page |
| Tax losses incurred | Can't be carried forward | Decision No. 73, Article 4 |
| Net interest expenditure | Can't be carried forward | Decision No. 73, Article 5 |
| Other reliefs and deductions | Not available | FTA Small Business Relief page |
| Transfer pricing documentation | Not required, but the arm's length principle still applies | FTA Small Business Relief page |
Losses from earlier years in which you didn't elect can still be carried forward to later non-elected periods, subject to Article 37 of the Corporate Tax Law.
Do you still have to register and file a return?
Yes. The FTA states that eligibility for the relief doesn't remove the obligation to file a corporate tax return; you elect the relief in the return itself, and you can use a simplified return.
- Register for corporate tax on EmaraTax (the FTA portal) and get your registration number.
- Keep accounting records that show your revenue stayed within AED 3,000,000 in every period.
- Elect Small Business Relief in the corporate tax return for the period.
- File the return within nine months of the end of the tax period. For a period ending 31 December 2025, the FTA set the deadline at 30 September 2026.
If you'd rather not track these dates by hand, the free UAE compliance calendar lists them for your company.
| Item | Amount | Source (as of 28 October 2026) |
|---|---|---|
| Late tax return | AED 500 per month or part of a month for the first 12 months; AED 1,000 per month from the 13th month | Cabinet Decision No. 75 of 2023, item 7 |
| Failure to keep required records | AED 10,000 per violation; AED 20,000 for a repeat within 24 months | Cabinet Decision No. 75 of 2023, item 1 |
31 December 2029: the latest date a tax period can end and still be covered by Small Business Relief under Ministerial Decision No. 131 of 2026. Source: Ministerial Decision No. 131 of 2026, amending Article 2(2) of Ministerial Decision No. 73 of 2023, checked 28 October 2026.
What most guides don't tell you
- The extension is tied to when a period ends, not when it starts. A company with a 31 December year-end is covered for periods ending in 2027, 2028 and 2029. A company with a 30 June year-end is covered for the period ending 30 June 2029, but on the current wording the period ending 30 June 2030 falls outside it. If you're picking or changing a year-end, this is worth a conversation first.
- Electing can cost more than it saves. Say a SHAMS consulting company loses AED 400,000 in its first year and expects AED 2m of profit in year two. Electing in year one means that loss can't be carried forward, so it can't offset the year-two profit. This is a hypothetical, but it follows directly from Article 4 of Decision No. 73, and it's why the election is made period by period rather than assumed.
- One year above the limit closes the door for good. Because the test looks at the relevant period and all previous periods, a single year above AED 3,000,000 blocks every later election, as the FTA's example shows. A business growing towards the limit should model its ordinary corporate tax position a year early.
- Splitting a business to stay under the limit is a known target. Article 6 of Decision No. 73 lets the FTA treat an artificial separation of a business as an arrangement made to obtain a corporate tax advantage, if the combined revenue exceeds AED 3,000,000. Commercial purpose and shared business activity are among the factors it looks at.
Which deadlines apply to your company?
Your corporate tax return deadline depends on your financial year-end, and VAT, licence and audit dates run on separate clocks. Qawi offers a free calendar of your company's UAE tax and compliance deadlines, personalised from a few questions, as a PDF and calendar file: get your UAE compliance calendar.
Frequently asked questions
What is Small Business Relief and do I qualify?
Small Business Relief is an election under which an eligible Resident Person is treated as having no taxable income for a tax period, so it pays no corporate tax for that period. You qualify if your revenue was AED 3,000,000 or less in the current period and every previous period, and you are not a Qualifying Free Zone Person or a constituent company of a multinational enterprise group.
Can I claim Small Business Relief if my revenue is just over the limit?
No. If your revenue exceeded AED 3,000,000 in the relevant period or any previous period, you can't elect the relief, and the FTA's example shows that a year above the limit blocks later years too. A business that's close to the limit should work out its ordinary corporate tax position instead.
Do sole establishments need to register for corporate tax?
A sole establishment is run by a natural person, so the owner is taxable only if business turnover exceeds AED 1,000,000 in a Gregorian calendar year under Cabinet Decision No. 49 of 2023. Below that the owner isn't required to register; above it, registration applies, and Small Business Relief may then be available if revenue stays at or below AED 3,000,000.
Do freelancers have to pay corporate tax in the UAE?
The same natural-person test applies: a freelancer is taxable only if business turnover exceeds AED 1,000,000 in a calendar year, and wages, personal investment income and real estate investment income are left out of that test. If your licence sits inside a company, check which entity is the taxable person before deciding.
About Qawi · Qawi is a corporate services firm licensed in the Sharjah Media City (SHAMS) free zone, handling company formation, visas and PRO, bookkeeping, VAT and corporate tax for UAE businesses. Guides are researched from FTA, Ministry of Finance and free zone sources. Qawi on LinkedIn
Sources
- Ministerial Decision No. 131 of 2026 (Ministry of Finance)
- Ministry of Finance announcement of the extension, 7 August 2026
- Ministerial Decision No. 73 of 2023 on Small Business Relief (FTA copy)
- FTA: Small Business Relief
- FTA: taxable persons eligible for Small Business Relief must submit simplified returns within the legal deadline
- Cabinet Decision No. 75 of 2023 and its amendments on administrative penalties (Ministry of Finance)
- Cabinet Decision No. 49 of 2023 on natural persons (Ministry of Finance)
Last checked: 28 October 2026
This is general information, not tax or legal advice for your specific situation.