9% corporate tax to be introduced on business profits in the UAE
February 2, 2022
Menu
Corporate Tax Small Business Relief – Ministerial Decision No. 73 of 2023
Corporate Tax Small Business Relief - Ministerial Decision No. 73 of 2023
The UAE Ministry of Finance has issued a new ministerial decision for businesses with revenues of AED 3 million or less, wherein they can claim a “Small Business Relief.” This Small Business Relief is provided to support startups and small or micro businesses in UAE.
Salient Features of Corporate Tax Small Business Relief:
- Taxable Resident Persons can claim Small Business Relief where revenue is below AED 3 million for each tax period
- Applicable Tax Periods: Starting on or after 1st June 2023 and ending or before 31st December 2026
- Revenue for the purpose of Small Business Relief can be ascertained as per the accounting standards accepted in UAE
- Qualifying Free Zones or Members of Multinational Enterprises Groups (MNE Groups) as defined in Cabinet Decision No. 44 of 2020 on Organising Reports Submitted by Multinational Companies will not be entitled to the Small Business Relief. MNE Groups are groups of companies operating in more than one country, having consolidated group revenues exceeding AED 3.15 billion.
- If a small business decides to disclaim Small Business Relief for a particular tax period, it will be allowed to carry forward incurred tax losses and disallowed net interest expenditure from such tax periods
- Anti-abuse rules are introduced so that businesses do not get into structuring their business activities to avoid the threshold of AED 3 million.
