A resident person with revenue of AED 3,000,000 or less, in the current tax period and every earlier one, can elect Small Business Relief and be treated as having no taxable income. It applies to periods starting on or after 1 June 2023 and ending on or before 31 December 2029, after Ministerial Decision No. 131 of 2026 replaced the old cut-off of 31 December 2026.
What changed in 2026
The original decision closed the relief at the end of 2026. For a business with a calendar financial year, that meant the period ending 31 December 2026 was the last one covered, and planning for 2027 had to assume a real corporate tax bill. In July 2026 the Minister replaced that clause. The threshold is unchanged; only the end date moved, out to 31 December 2029.
Chart data
| Point | Date |
|---|---|
| Relief starts | periods from 1 June 2023 |
| Old end date | was 31 December 2026 |
| New end date | 31 December 2029 |
The revenue test is a history, not a snapshot
Read the condition carefully: revenue must be at or under the limit in this period and in all previous ones. The FTA's own example makes the point. A business in Sharjah with AED 1.9 million of revenue in the period ending 31 December 2026 cannot elect, because in the previous period it had AED 4.3 million. One good year closes the door on the years that follow it.
Note also that the test runs on revenue, not on profit. This is the one place in the corporate tax rules where the top line matters more than the bottom line, which surprises owners who are used to thinking in margins.
Who cannot elect
Two groups are excluded outright: a Qualifying Free Zone Person, and a member of a multinational group with consolidated revenue above AED 3.15 billion. The first exclusion matters for small businesses far more than the second. If you hold free zone status and qualify for the 0% rate on qualifying income, Small Business Relief is not also available to you.
You still file. All of it.
The FTA has been explicit on this, most recently in August 2026: relief is elected in the return. Eligible businesses register for corporate tax, submit a simplified return within the statutory deadline, and keep the records that let the FTA verify revenue and eligibility. Electing the relief reduces what you have to submit; it does not remove the submission.
For a financial year that ended on 31 December 2025, the FTA set the deadline at 30 September 2026, and said so specifically for businesses eligible for the relief. Generally the rule is 9 months from the end of the tax period.
What the relief is worth in money
Less than people expect, and more than it looks. On AED 3 million of revenue with, say, AED 500,000 of taxable income, the tax avoided is 9% of AED 125,000, or AED 11,250. The bigger saving is in the work: a simplified return is cheaper to prepare than a full one, against published corporate tax filing fees of AED 2,500–5,000 a year.
That is also the trap. Because the relief makes the tax zero, it is easy to treat the filing as optional, and then a business crosses AED 3 million mid-period with no clean books behind it. If that is your trajectory, start paying for bookkeeping before the year you need it.
What to do next
- Check revenue in every period since your first, not just this one.
- If you are in a free zone, confirm your status first: the two reliefs do not stack.
- Diarise the filing date. The election lives on the return, and the return has a deadline.
- Put your own numbers through the corporate tax calculator with the relief switch on and off.