Elective, not automatic — and ending soon
Small Business Relief Advisory
Small Business Relief lets eligible UAE businesses with revenue up to AED 3,000,000 be treated as having no taxable income for the period — but it must be actively elected in the return every period, not assumed to apply automatically once you're under the threshold.
Sunset: periods ending on or before 31 December 2029
Key facts
| Eligibility threshold | Revenue up to AED 3,000,000 in the relevant tax period and every previous tax period |
| Effect | Treated as having no taxable income for the period, if elected |
| Election required | Yes — not applied automatically even if you meet the revenue threshold |
| Sunset date | Periods ending on or before 31 December 2029 — after that, full computation applies |
What this actually involves
Small Business Relief was designed to reduce the compliance burden on genuinely small UAE businesses, letting eligible entities skip the full corporate tax computation and simply be treated as having no taxable income for the period. The revenue threshold — AED 3,000,000 — must be met in the relevant tax period and in every previous tax period, so eligibility needs reassessing each period rather than assumed to carry forward automatically.
The relief is elective, meaning it must be actively claimed within the corporate tax return itself. Businesses that assume it applies automatically because they're under the threshold have, in practice, been assessed on ordinary corporate tax principles with no relief applied, simply because the election box was never checked.
The relief was originally scheduled to sunset for periods ending after 31 December 2026, but the Ministry of Finance announced in August 2026 that the window has been extended to periods ending on or before 31 December 2029. That extension is genuinely good news for small businesses, but it's not a reason to stop building proper record-keeping capability — the relief remains elective every single period, and eligibility (and the rules around it) can still change before 2029 arrives.
Is this actually relevant to you?
- Your UAE business has revenue under AED 3,000,000 and you're currently relying on, or considering, Small Business Relief
- You've been electing the relief in prior periods and want confirmation it's still being applied correctly
- You want to understand whether the relief's rules or eligibility might change again before its current 2029 sunset
- You're unsure whether your revenue calculation for eligibility purposes is being done correctly
Our process, step by step
Eligibility assessment
Confirming your revenue genuinely qualifies for the relevant period, including how revenue is precisely defined for this purpose.
Election preparation
Made correctly within your corporate tax return, not assumed or left unchecked.
Sunset transition planning
Building your accounting capability now for full computation once the relief ends, rather than scrambling in the final qualifying period.
Scope of work
Relief is elected in the corporate tax return for each period, and still requires corporate tax registration and proper bookkeeping to support the revenue figure.
The two mistakes we see most often
- Assuming the relief applies automatically because revenue is under the threshold — it must be actively elected in every qualifying period.
- Assuming the relief's rules are now fixed until 2029 given the recent extension — the eligibility criteria and sunset date have already changed once and could be adjusted again.
Related corporate tax services in the UAE
Every corporate tax service is delivered by the same team that keeps your books, so registrations, returns and elections stay consistent year to year.
Related guides from our team
Practical explanations of the rules behind this service, written by our chartered accountants.
Common questions
Does Small Business Relief apply automatically if we're under the threshold?+
No — it must be actively elected in your corporate tax return. Assuming automatic application has led to businesses being assessed on ordinary principles with no election on record.
When does Small Business Relief actually end now?+
It was originally scheduled to end for periods after 31 December 2026, but the Ministry of Finance extended it in August 2026 to periods ending on or before 31 December 2029. Businesses relying on it should still build proper bookkeeping capability regardless, since the relief remains elective every period and its terms have already changed once.
Is the AED 3,000,000 threshold based on UAE revenue only or worldwide revenue?+
This needs confirming against the specific definition of revenue for relief purposes, which can include certain related considerations beyond a simple UAE sales figure.
Can a business elect Small Business Relief in one period and not the next?+
Eligibility and election are assessed period by period, so a business can potentially move in and out of eligibility as revenue changes year to year.
Does claiming Small Business Relief affect our ability to claim other reliefs?+
This depends on the specific interaction between reliefs and your business's overall structure — worth reviewing holistically rather than assuming reliefs stack without interaction.
Relying on Small Business Relief and not sure what happens next?
Let's plan your transition now, while there's still runway — not in the quarter the relief disappears and full computation suddenly becomes mandatory.