Breaking News — 7 August 2026

Great news for small businesses and startups across the UAE. The Ministry of Finance has officially announced the extension of Small Business Relief under the UAE Corporate Tax regime until 31 December 2029 — three additional years beyond the original deadline of 31 December 2026.

The extension was announced through Ministerial Decision No. 131, which amends the provisions of the Ministerial Decision governing the taxation of corporations and businesses in the UAE.

What Is Small Business Relief?

Small Business Relief is a UAE Corporate Tax provision that allows eligible small businesses and startups to be treated as having zero taxable income for a tax period. In other words, if your business qualifies, you pay 0% Corporate Tax — regardless of your actual profit level.

The relief was originally introduced under Ministerial Decision No. 73 of 2023 to reduce the Corporate Tax compliance burden on smaller businesses. Furthermore, it was designed to support entrepreneurs and startups in their early growth phases.

What Has Changed — The Key Update

Previously, Small Business Relief was only available for tax periods ending on or before 31 December 2026. Many UAE business owners were concerned about what would happen from 2027 onwards.

The Ministry of Finance has now confirmed that Small Business Relief will continue to apply to tax periods ending on or before 31 December 2029 — giving UAE small businesses three additional years of relief.

Specifically, the key facts of the extension are:

New deadline: Tax periods ending on or before 31 December 2029
Revenue threshold: Unchanged at AED 3 million per year
Applies to: Tax periods commencing on or after 1 June 2023
Decision reference: Ministerial Decision No. 131 of 2026

Who Qualifies for Small Business Relief?

To qualify for Small Business Relief, your business must meet the following conditions:

Your total revenue for the tax period must not exceed AED 3 million
Your revenue must not have exceeded AED 3 million in any previous tax period since June 2023
You must be a UAE resident person — a UAE-incorporated company or an individual running a business in the UAE
You must actively elect for Small Business Relief when filing your Corporate Tax return — it is not applied automatically

Who Cannot Claim Small Business Relief?

The following businesses are not eligible for Small Business Relief regardless of their revenue:

Qualifying Free Zone Persons (QFZPs) — free zone companies claiming 0% CT on qualifying income under the QFZP regime
Members of multinational enterprise groups with consolidated global revenue above AED 3.15 billion
Businesses that have previously exceeded the AED 3 million revenue threshold in any tax period since June 2023

What Does This Mean for Your Business?

If Your Revenue Is Under AED 3 Million

This is excellent news. You now have certainty that Small Business Relief is available until the end of 2029. Therefore, if you qualify, make sure you actively elect for the relief in every CT return you file between now and December 2029.

Furthermore, the FTA has reminded businesses that even if you elect for Small Business Relief, you must still:

Be registered for Corporate Tax
File your Corporate Tax return on time
Maintain proper financial records for a minimum of 5 years
Comply with all other UAE Corporate Tax law obligations

In other words, Small Business Relief reduces your tax to zero — but it does not exempt you from filing or compliance obligations.

If Your Revenue Is Approaching AED 3 Million

If your business revenue is growing toward the AED 3 million threshold, now is the time to plan carefully. Specifically, review your revenue projections for 2027, 2028, and 2029 with your tax agent. As a result, you can make informed decisions about your business structure and tax position before you exceed the threshold.

If Your Revenue Has Already Exceeded AED 3 Million

Unfortunately, once your revenue exceeds AED 3 million in any tax period, Small Business Relief is no longer available to you — even in future periods where revenue may fall below the threshold again. Therefore, if you have already crossed this threshold, focus on maximising your allowable deductions and working with an FTA-registered tax agent to optimise your CT filing.

Why Has the UAE Extended Small Business Relief?

The Ministry of Finance stated that the extension is aimed at:

Supporting entrepreneurs and small businesses as they develop and expand
Strengthening the UAE business environment
Reinforcing the UAE's position as a leading global investment destination
Promoting tax compliance among small businesses and startups
Maintaining a competitive Corporate Tax framework aligned with international best practices

Furthermore, the timing of this announcement is significant. SMEs account for more than 94% of UAE businesses and contribute over 60% of the country's non-oil GDP. Therefore, supporting small businesses through an extended tax relief period directly supports the UAE's broader economic development goals.

Important Reminder — You Must Still File Your CT Return

The FTA issued a specific reminder alongside this announcement — businesses eligible for Small Business Relief must still fulfil all their Corporate Tax obligations. Specifically, this means:

Register for Corporate Tax within 90 days of your trade licence issuance
File your CT return by the deadline — for most businesses with a 31 December year end, this is 30 September each year
Elect for Small Business Relief in your CT return — it is not automatic
Maintain financial records for a minimum of 5 years

Therefore, do not mistake the extension of Small Business Relief as a relaxation of compliance requirements. The obligations remain the same — only the tax payable is zero.

Your Action Plan — What to Do Now

If you are not yet registered for Corporate Tax:
Register immediately on EmaraTax. The penalty for late registration is AED 10,000. Furthermore, you cannot file your CT return or claim Small Business Relief without an active CT registration.

If you are registered but have not yet filed your CT return:
Your CT return for the financial year ending 31 December 2025 is due on 30 September 2026. Contact Finhub Middle East immediately — we handle urgent CT filings and can prepare and submit your return before the deadline.

If you have already filed your CT return:
No action needed regarding this announcement. However, make sure you elect for Small Business Relief in your next CT return if you continue to qualify.

If you are unsure whether you qualify:
Contact Finhub Middle East for a free consultation. We assess your eligibility, handle your CT registration, and file your return with the Small Business Relief election correctly applied.

Frequently Asked Questions

Does the Small Business Relief extension apply automatically?
No. You must actively elect for Small Business Relief in each CT return you file. The extension simply means the relief remains available until 31 December 2029 — but you must still claim it in every return.

Does Small Business Relief mean I do not need to file a CT return?
No. You must still file your CT return on time even if you are claiming Small Business Relief. The FTA has specifically reminded businesses of this obligation alongside the extension announcement.

What happens if my revenue exceeds AED 3 million in one year?
If your revenue exceeds AED 3 million in any tax period, you lose eligibility for Small Business Relief permanently — even if your revenue falls below AED 3 million in a future period.

Can a free zone company claim Small Business Relief?
No. Qualifying Free Zone Persons (QFZPs) cannot claim Small Business Relief. Furthermore, members of multinational groups with consolidated revenue above AED 3.15 billion are also excluded.

What is the CT return deadline for most UAE businesses?
For businesses with a 31 December financial year end — which covers most UAE businesses — the CT return deadline is 30 September each year. Therefore, for the financial year ending 31 December 2025, the deadline is 30 September 2026.

Need Help With Your Corporate Tax Filing?

At Finhub Middle East, we handle Corporate Tax registration, CT return preparation, and Small Business Relief elections for UAE businesses of all sizes. Moreover, with the 30 September 2026 deadline approaching fast, now is the time to get your CT filing in order.

Our Corporate Tax services:

Corporate Tax Registration — AED 150
Corporate Tax Return Filing with Small Business Relief election — from AED 500
Bookkeeping and Accounting — from AED 500/month

📞 Call us: 050 516 9396
💬 WhatsApp: wa.me/971505169396
📍 Office: Karama, Dubai
🌐 finhubmiddleeast.com

Free consultation available. We respond within minutes on WhatsApp.

Finhub Middle East FZE is an FTA-registered tax agent in Dubai providing VAT, Corporate Tax, company formation, accounting, and compliance services to UAE businesses since 2021.

UAE Extends Corporate Tax Small Business Relief Until 2029 — What It Means for Your Business