The UAE’s corporate tax regime has introduced a game-changing opportunity for small businesses: the Small Business Relief (SBR) provision. Designed to ease the financial and administrative burden on SMEs, this initiative allows qualifying businesses to pay 0% corporate tax UAE, but only if they follow the correct compliance steps.
What is Small Business Relief?
Small Business Relief is a tax benefit under the UAE Corporate Tax Law that treats eligible businesses as if they earned no taxable income for a given period. This means no corporate tax liability, provided the business meets the criteria and follows the required process.
Who Qualifies for Small Business Relief?
To be eligible, a business must:
- Be a Resident Taxable Person (individual or legal entity).
- Have annual revenue not exceeding AED 3 million for the current and all previous tax periods.
- This provision is provided by the UAE government until the year December 31, 2026.
- Elect to apply for Small Business Relief by indicating it on the corporate tax UAE return.
Who is Excluded?
- Multinational Enterprise Groups with global revenues over AED 3.15 billion.
- Qualifying Free Zone Persons already benefiting from 0% tax on qualifying income.
Small Business Relief Compliance Process: Step-by-Step
- Register for Corporate Tax UAE
All businesses must register with the Federal Tax Authority (FTA), even if they plan to claim small business relief. - Maintain Accurate Financial Records
Ensure your revenue remains under the AED 3 million threshold and is properly documented. - File Your Corporate Tax Return
Submit your return within the legal deadline and select the Small Business Relief option in the relevant section. - Monitor Revenue Thresholds
If your revenue exceeds AED 3 million in any tax period, you must stop claiming Small Business Relief and begin calculating taxable income accordingly. - Stay Updated
Refer regularly to the official FTA guidelines for updates and clarifications on eligibility, thresholds, and documentation.
Why Small Business Relief Matters?
This relief is a strategic move to support entrepreneurship, financial sustainability, and ease of doing business in the UAE. For small businesses, it’s not just a tax break—it’s a valuable opportunity to reinvest in growth, talent, and innovation while staying compliant with the corporate tax UAE laws.
We at Accountant’s Box are committed to bring to you knowledge regarding corporate tax in simple words which is utmost important to you. Keep reading our blogs and let us know if any topic that you would like to understand with UAE tax law perspective. Recently we posted a blog to explain in How To Get Your Corporate Tax Penalty Waived? www.accountantsbox.com/blog . Hope this brings some knowledge to you on the process. We at Accountant’s Box help SME clients with their accounting and taxation needs. If you would like to connect with us please send in your email at info@accountantsbox.com.