What is small business relief for UAE corporate tax?
An election for resident businesses whose revenue is AED 3,000,000 or less in the current and every previous tax period. Ministerial Decision No. 73 of 2023 set the threshold, and Decision No. 131 of 2026 extended the relief to tax periods ending on or before 31 December 2029. It must still register and file a return.
On this page
Who cannot elect it
Members of multinational enterprise groups and qualifying free zone persons. A business whose revenue exceeded AED 3,000,000 in any earlier tax period cannot elect it again. Splitting a business to stay under the threshold is treated as an artificial arrangement.
The cost of electing
Tax losses from a period in which the relief is elected cannot be carried forward, and neither can net interest expenditure. A small contractor with a loss year may be better off not electing, to keep the loss for later profitable years.
How SupaJack Construct helps
Revenue per tax period comes straight from the invoices posted to the ledger, so a small contractor can see how close it is to the AED 3,000,000 threshold before the period ends. When the relief is elected and revenue is within the threshold, the corporate tax calculation applies it to tax periods ending on or before 31 December 2029.
Related tools and guides
See the answers on the corporate tax rate, small business relief, the corporate tax return deadline, carrying tax losses forward and whether fines are deductible, plus finance and VAT in SupaJack Construct, the VAT guide for contractors and the construction accounting software page.
Worked example
A joinery subcontractor has revenue of AED 2,600,000 and profit of AED 500,000 for 2027. It elects small business relief and pays no corporate tax, instead of AED 11,250 on the AED 125,000 above the zero band. If its revenue reaches AED 3,100,000 in 2028, it loses the relief for 2028 and every later year.
Questions people ask
Is the relief still available in 2027?
Yes. Decision 131 of 2026 extended it to tax periods ending by 31 December 2029.
Is registration still needed?
Yes, and the relief must be elected in the return.
Can losses be carried forward in a relief year?
No.