UAE EXTENDS SMALL BUSINESS RELIEF TO 2029: WHAT IT MEANS FOR YOUR CORPORATE TAX FILING

The UAE Ministry of Finance (MoF) has extended Small Business Relief under the Corporate Tax Law, giving eligible small businesses and start-ups three more years of simplified compliance. If your business generates AED 3 million or less in annual revenue, this update directly affects your Corporate Tax strategy through 2029 and CMBS Partners is here to break down exactly what changed and what you need to do next.

What Changed: Ministerial Decision No. 131 of 2026

On 7 August 2026, the Ministry of Finance announced Ministerial Decision No. (131), amending the existing rules on the Taxation of Corporations and Businesses. The amendment extends the window during which eligible businesses can claim Small Business Relief to tax periods ending on or before 31 December 2029.

Previously, under Ministerial Decision No. 73 of 2023, the relief was set to expire for tax periods ending on or before 31 December 2026. This new decision pushes that deadline back by three full years, giving qualifying businesses continued access to simplified Corporate Tax treatment.

Key Facts Every Small Business Owner Should Know

-Revenue threshold unchanged: The AED 3 million (approximately $817,000) annual revenue threshold remains exactly the same, the extension does not raise the eligibility bar.

-New applicable period: The relief now applies to tax periods commencing on or after 1 June 2023 and ending on or before 31 December 2029.

-Not automatic: Small Business Relief is not an automatic exemption. Eligible businesses must actively elect the relief through their Corporate Tax Return for each applicable tax period.

-Filing obligations remain: Even when the relief is elected, businesses are still required to register for Corporate Tax, file returns, and maintain proper records with the Federal Tax Authority (FTA).

-Exclusions still apply: Qualifying Free Zone Persons and members of large Multinational Enterprise (MNE) Groups, those with consolidated group revenue exceeding roughly $858 million (AED 3.15 billion) remain ineligible for the relief.

Why the Extension Matters

According to the Ministry, the decision reflects the UAE’s ongoing commitment to supporting entrepreneurs and start-ups, strengthening the domestic business environment, and reinforcing the country’s standing as a leading global investment hub. It also signals continued alignment between the UAE’s Corporate Tax framework and international best practices, offering small businesses greater long-term certainty as they plan their growth strategies.

For business owners, the practical takeaway is stability: instead of facing the relief’s expiration at the end of 2026, qualifying companies now have a clear runway through the end of 2029 to benefit from reduced compliance requirements while they scale.

How CMBS Tax Can Help

Navigating Corporate Tax elections, thresholds, and FTA filing requirements can be time-consuming, especially as regulations continue to evolve. CMBS Partners and our dedicated CMBS Tax team help UAE businesses:

-Assess eligibility for Small Business Relief and other Corporate Tax reliefs

-Correctly elect relief within Corporate Tax Returns

-Maintain FTA-compliant registration, filing, and record-keeping

-Plan ahead for tax periods approaching or exceeding the AED 3 million threshold

-Stay current on Ministerial Decisions and Corporate Tax Law updates

If your business currently benefits from Small Business Relief or is approaching the AED 3 million revenue threshold, now is the time to review your Corporate Tax position and ensure you’re structured to make the most of this extension through 2029.

Contact CMBS Tax today to schedule a Corporate Tax review and confirm your eligibility for Small Business Relief.

This article is for informational purposes and does not constitute tax or legal advice. For guidance specific to your business, consult with the CMBS Tax team.