Blog
Small Business Relief ends with your 2026 tax period
الإجابة المختصرة
UAE Small Business Relief lets a resident taxable person with revenue below AED 3 million be treated as having no taxable income for a tax period. Under Ministerial Decision No. 73 of 2023 the AED 3 million threshold applies to tax periods starting on or after 1 June 2023 and only continues to apply to tax periods ending on or before 31 December 2026. Qualifying Free Zone Persons and members of Multinational Enterprise Groups cannot claim it.
Small Business Relief has done quiet work for a lot of newly incorporated UAE companies since 2023: revenue under AED 3 million, and the corporate tax position becomes straightforward.
It was always time-limited, and the limit is now close enough to plan around. The relief applies only to tax periods ending on or before 31 December 2026. For a business on a calendar financial year, the period running now is the last one in which it can be claimed.
The conditions
The revenue test looks backwards as well as at the current period. Once the AED 3 million threshold has been exceeded in any tax period, the relief is no longer available — including in a later period where revenue happens to fall back below it.
- The taxable person must be a resident person
- Revenue must be below AED 3 million in the relevant tax period and in all previous tax periods
- Applies to tax periods starting on or after 1 June 2023
- Applies only to tax periods ending on or before 31 December 2026
- Not available to Qualifying Free Zone Persons
- Not available to members of Multinational Enterprise Groups
The free-zone exclusion catches people out
A Qualifying Free Zone Person cannot claim Small Business Relief. This is not a penalty; the two regimes are alternatives, and a QFZP already has a 0% rate on its qualifying income.
Where it causes confusion is with free-zone companies that are not QFZPs — a free-zone licence does not by itself make a company a Qualifying Free Zone Person. A free-zone company that does not meet the QFZP conditions is not automatically shut out of Small Business Relief by virtue of its address. Which regime applies is a question about the company's activities and how it meets the conditions, not about where it is registered.
What changes when the relief ends
The relief reduces both tax and compliance burden — eligible businesses file a simplified return. When it falls away, a business that has been operating inside it moves to ordinary corporate tax compliance: full return, taxable income properly computed, records to support it.
The work that makes that transition uneventful is bookkeeping done during the year rather than reconstructed after it. A business that has been keeping minimal records because the relief made precision unnecessary is the one for which the first post-relief filing is expensive.
Questions worth settling before the period closes
- Is your current tax period the last one ending on or before 31 December 2026?
- Has revenue stayed below AED 3 million in this and every previous tax period?
- If you are in a free zone, do you meet the QFZP conditions, or not?
- Are your books in a state that would support an ordinary return rather than a simplified one?
- Do you know what your taxable income would have been this period without the relief?
In short
What to take from this
- Small Business Relief applies only to tax periods ending on or before 31 December 2026.
- Revenue must be below AED 3 million in the current and all previous tax periods — exceeding it once ends eligibility permanently.
- Qualifying Free Zone Persons and MNE Group members cannot claim it.
- A free-zone licence does not by itself make a company a QFZP.
- The transition costs least for businesses whose bookkeeping was already ordinary-return quality.
- When does UAE Small Business Relief end?
- The AED 3 million revenue threshold applies to tax periods starting on or after 1 June 2023 and only continues to apply to tax periods ending on or before 31 December 2026.
- What is the revenue threshold for Small Business Relief?
- Revenue must be below AED 3 million in the relevant tax period and in all previous tax periods. Once the threshold is exceeded in any tax period, the relief is no longer available.
- Can a free zone company claim Small Business Relief?
- A Qualifying Free Zone Person cannot claim Small Business Relief. A free-zone licence does not by itself make a company a Qualifying Free Zone Person, so whether the exclusion applies depends on whether the QFZP conditions are met.
- Who else is excluded from Small Business Relief?
- Members of Multinational Enterprise Groups cannot claim Small Business Relief, alongside Qualifying Free Zone Persons.
المصادر
Where this comes from
هذه الصفحة هي معلومات عامة حول تأسيس الشركات في الإمارات العربية المتحدة، وليست مشورة قانونية أو ضريبية أو متعلقة بالهجرة أو مصرفية. يمكن أن تتغير القواعد والرسوم والأنشطة المسموح بها وسياسات البنوك. تعتمد الأهلية النهائية على حقائقك والقواعد المعمول بها وقت تقديم الطلب.