UAE announces corporate tax relief for small businesses

Main points:

1. Resident taxable persons can claim Small Business Relief where their revenue in the relevant and previous tax periods is below AED3 million per year.
2. The Relief covers the period from 1 June 2023 to 31 December 2026.
3. Revenue can be determined based on the applicable accounting standards accepted in the UAE.
4. Relief will not be available to Qualifying Free Zone Persons or members of Multinational Enterprises Groups; where the consolidated group revenue exceeds AED3.15 billion.
5. Where businesses do not elect to apply for Small Business Relief, Carry forward of any incurred Tax Losses and any disallowed Net Interest Expenditure is allowed in case they are related to the un-opted period.
6. Advised not to resort to the artificial separation of business, which will be considered an arrangement to obtain a Corporate Tax advantage under Clause (1) of Article 50 regarding the general anti-abuse rules.