UAE Corporate Tax: Small Business Relief Extended to 2029
Regulatory Snapshot
| Jurisdiction | United Arab Emirates |
|---|---|
| Issuing authority | Ministry of Finance, United Arab Emirates |
| Instrument | Ministerial Decision No. 131 of 2026 Amending Certain Provisions of Ministerial Decision No. 73 of 2023 on Small Business Relief for the Purposes of Federal Decree-Law No. 47 of 2022 on the Taxation of Corporations and Businesses |
| Announced | 7 August 2026 |
| Effective | Reported as the day following publication, on or about 8 August 2026 |
| Applies to | Eligible resident taxable persons with revenue not exceeding AED 3 million per tax period; excludes Qualifying Free Zone Persons and members of a Multinational Enterprise Group |
| Compliance deadline | Not applicable |
| Status | Active |
| Last verified | 15 August 2026 |
This update concerns UAE Corporate Tax compliance for resident taxable persons, including holding structures used in connection with UAE residency by company establishment. NTL's coverage of this development is provided in compliance with all applicable UAE laws through specialized tax counsel and a specialized legal team. Nothing in this article constitutes tax or legal advice for a specific structure.
Key Regulatory Takeaways
- UAE Small Business Relief eligibility now extends through tax periods ending on or before 31 December 2029, three years beyond the original 2026 sunset.
- The AED 3 million revenue threshold for eligibility is unchanged.
- Qualifying Free Zone Persons and members of a Multinational Enterprise Group remain excluded.
- The extension applies to eligibility timing only. It does not introduce a new filing deadline or a new compliance obligation.
UAE Small Business Relief has been extended to tax periods ending on or before 31 December 2029, giving eligible resident taxable persons three additional years of simplified Corporate Tax compliance. The extension was introduced under Ministerial Decision No. 131 of 2026, which amends the original Small Business Relief mechanism set out in Ministerial Decision No. 73 of 2023 under Federal Decree-Law No. 47 of 2022 on the Taxation of Corporations and Businesses. The underlying AED 3 million revenue threshold and the categories of excluded persons are unchanged; only the sunset date on eligibility moves.
UAE Small Business Relief 2029: What Changed Under Ministerial Decision No. 131
The UAE Ministry of Finance issued Ministerial Decision No. 131 of 2026 amending the Small Business Relief provisions set out in Ministerial Decision No. 73 of 2023 for the purposes of Federal Decree-Law No. 47 of 2022 on the Taxation of Corporations and Businesses. The Ministry's public statement on the amendment was issued on 7 August 2026, and the change is reported to take effect the day following its publication. Under the original 2023 decision, Small Business Relief was available only through tax periods ending on or before 31 December 2026. The 2026 amendment extends that eligibility window by three years, to tax periods ending on or before 31 December 2029. The relief itself continues to work the same way: an eligible resident taxable person can elect to be treated as having no taxable income for a qualifying tax period, removing the need to calculate and report Corporate Tax liability for that period.
Eligibility and Exclusions Under the Extended UAE Small Business Relief
Eligibility remains tied to the same AED 3 million revenue threshold introduced in 2023, unchanged by the 2026 amendment. A resident taxable person whose revenue for the relevant tax period, and each prior tax period since the relief's introduction, does not exceed AED 3 million can continue to elect into the relief through 2029. Two categories remain excluded regardless of revenue: Qualifying Free Zone Persons, who are already subject to a separate Corporate Tax regime, and members of a Multinational Enterprise Group, who fall under the UAE's Pillar Two-aligned rules instead. Applicants elect into Small Business Relief on a tax-period basis; the extension changes how many future periods that election remains available for, not the mechanics of making it.
What This Means for UAE-Resident Holding Structures
For clients using a UAE company as part of a residency or banking access structure, the extension is a compliance-cost benefit rather than a change to the underlying residency mechanics: a qualifying company can continue to elect simplified Corporate Tax treatment for three further tax periods instead of losing that option after 2026. It does not change visa, sponsorship, or company formation requirements for UAE residency by company establishment. Investors relying on a UAE holding structure who are close to or below the AED 3 million threshold should confirm eligibility for each tax period individually with their tax advisor, since revenue is assessed period by period rather than fixed at formation.
UAE Small Business Relief 2029 FAQ
What is the new eligibility deadline for UAE Small Business Relief 2029?
Under Ministerial Decision No. 131 of 2026, eligible resident taxable persons can elect into UAE Small Business Relief for tax periods ending on or before 31 December 2029, three years beyond the original 31 December 2026 sunset set in Ministerial Decision No. 73 of 2023.
Does the AED 3 million revenue threshold change under the extended UAE Small Business Relief?
No. The AED 3 million revenue threshold introduced in 2023 is unchanged by the 2026 amendment. Eligibility continues to depend on a resident taxable person's revenue for the relevant tax period remaining at or below that figure.
Who is excluded from UAE Small Business Relief under Ministerial Decision No. 131 of 2026?
Qualifying Free Zone Persons and members of a Multinational Enterprise Group remain excluded from UAE Small Business Relief, regardless of individual revenue, under both the original 2023 decision and the 2026 extension.
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