UAE Small Business Relief has been extended to eligible tax periods ending on or before 31 December 2029. Eligible resident businesses with revenue of no more than AED 3 million in the current and all previous Corporate Tax periods can elect for the relief, subject to the exclusions below. Registration, filing and record keeping still matter. This guide explains the practical checks for Ras Al Khaimah SMEs.
What changed in 2026?
The Ministry of Finance announced the extension on 7 August 2026. Ministerial Decision No. 131 of 2026, issued on 29 July 2026, replaces the former 31 December 2026 end date with 31 December 2029. It changes the duration of the relief; the AED 3 million threshold remains. Check your actual tax-period end date when assessing availability.
Who can claim Small Business Relief?
Under Ministerial Decision No. 73 of 2023, read with the 2026 amendment, the main checks are:
- Resident-person status for UAE Corporate Tax purposes.
- Revenue of AED 3 million or less in the relevant tax period and every previous Corporate Tax period. A prior breach prevents a later election even if revenue falls.
- Exclusion of Qualifying Free Zone Persons and constituent companies of multinational enterprise groups as defined in Cabinet Decision No. 44 of 2020.
- Revenue calculated using the applicable accounting standards accepted in the UAE.
Artificially splitting a business to stay within the threshold can trigger the Corporate Tax anti-abuse rules.
Can a RAKEZ company claim the relief?
A RAKEZ licence alone does not establish eligibility. The FTA Small Business Relief Guide distinguishes a Free Zone Person from a Qualifying Free Zone Person. A resident free-zone company that is not a Qualifying Free Zone Person may qualify if it meets the other conditions. A Qualifying Free Zone Person cannot claim the relief while retaining that status. Review the company’s tax position before making an election.
Does AED 3 million mean revenue or profit?
It means revenue. Expenses do not reduce revenue for this test. Review all relevant income, including foreign income and asset disposals where applicable, rather than using only trading profit. VAT collected for the FTA is excluded from revenue.
Illustrative example: a company has AED 3.2 million of revenue and AED 2.9 million of expenses. Its AED 300,000 profit does not make it eligible for Small Business Relief: revenue exceeds the threshold.
What must an eligible business still do?
The FTA’s 3 August 2026 filing reminder confirms that eligible businesses must register for Corporate Tax, elect for relief through their return, submit the simplified return and retain evidence supporting eligibility. An accepted election treats the business as having no taxable income for that period. The return is still due within nine months of the tax-period end. Keep transaction, asset, liability and ownership records that support the figures reported.
A practical preparation checklist for RAK business owners
Before the next return, we recommend preparing one organised review folder:
- Period summary: record the start and end dates shown in EmaraTax and assign someone to track the filing deadline.
- Revenue reconciliation: connect the ledger to invoices, bank records and other income; investigate differences before finalising the figures.
- History schedule: list revenue for each previous Corporate Tax period, with links to the supporting accounts.
- Status review: document the company’s residency, free-zone treatment and any group membership that affects eligibility.
- Decision record: retain the eligibility assessment, election decision, submitted return and acknowledgement together.
Rasif can help organise this work through our accounting and bookkeeping services and Corporate Tax support. The checklist is a practical preparation approach; the legislation determines eligibility.
Frequently asked questions
Is the relief automatic?
No. An eligible business must elect for Small Business Relief in its Corporate Tax return for the relevant period.
Does the relief remove VAT obligations?
No. Small Business Relief applies to Corporate Tax. Existing VAT compliance obligations continue.
Should every eligible business elect?
Review the consequences first. Tax losses incurred in a period for which relief is elected cannot be carried forward. Previously unutilised losses from periods without an election have separate carry-forward conditions under the legislation.
Need help checking your eligibility?
Contact Rasif Accountants FZ-LLC to review your records and Corporate Tax position. Bring your trade licence, tax-period details, previous returns and current accounts so the review starts with evidence.
Call +971 55 770 9776 or +971 7 204 1565, or email info@rasifaccountants.com. Visit Office 10, Floor 10, Tower 2, RAKEZ Explorer Business Hub, Al Hamra Industrial, Ras Al Khaimah, UAE.
Sources checked on 23 October 2026. The linked FTA guide dates from August 2023; its original 2026 end date must be read with the 2026 amendment above. This article provides general information; application depends on the business’s circumstances.
