Small Business Relief: what it means in UAE tax.

What small business relief means

Also called: SBR.

Small Business Relief lets a small UAE resident business elect to be treated as having no taxable income for a tax period, so no Corporate Tax is payable. It comes from Article 21 of the Corporate Tax Law, with the detail in Ministerial Decision No. 73 of 2023.

The key test is revenue, not profit. Revenue must not exceed AED 3,000,000 in the tax period and in every previous tax period. Once revenue has gone over the threshold in any period, the relief is closed for good. Qualifying Free Zone Persons and members of large multinational groups cannot use it.

The relief was originally due to end with tax periods ending on or before 31 December 2026. In August 2026 the Ministry of Finance announced Ministerial Decision No. 131, which extends it to tax periods ending on or before 31 December 2029. Electing is not free: tax losses and net interest expenditure from a relief year cannot be carried forward, and the business remains a Taxable Person that must stay registered and file returns.

How it works

• The business must be a Resident Person and a Taxable Person.
• Revenue for the tax period, and for each previous tax period, must not exceed AED 3,000,000, measured under accepted accounting standards.
• The relief applies to tax periods starting on or after 1 June 2023 and ending on or before 31 December 2029.
• When elected, exempt income rules, reliefs, deductions, tax loss relief and transfer pricing documentation under Article 55 do not apply for that period.
• Losses and net interest expenditure of a relief period cannot be carried forward. Earlier losses wait for a later period in which the relief is not elected.
• Splitting one business into several to stay under the threshold is treated as an abusive arrangement.

Worked example

A Dubai marketing consultancy has revenue of AED 2,400,000 and has never had revenue above AED 3,000,000. Its taxable income before any relief would be AED 600,000.

Revenue for the tax period	AED 2,400,000
Taxable income before relief	AED 600,000
Corporate Tax without relief (9% on 225,000)	AED 20,250
Corporate Tax with Small Business Relief elected	AED 0
Saving for the period	AED 20,250

The test is revenue of AED 2,400,000, not profit, and electing brings the bill for the period to nil.

Common mistakes

• Testing profit instead of revenue. A business with low profit but revenue over AED 3,000,000 does not qualify.
• Electing in a loss year without thinking. The loss is lost for good, which can cost more later than the relief saves.
• Assuming the relief removes the need to register and file. The business is still a Taxable Person.

The law

• Federal Decree-Law No. 47 of 2022, as amended, Article 21 (Small Business Relief)
• Ministerial Decision No. 73 of 2023 on Small Business Relief, Articles 2 to 6
• Ministerial Decision No. 131 amending Ministerial Decision No. 73 of 2023 (extension to tax periods ending on or before 31 December 2029), announced by the Ministry of Finance on 7 August 2026
• Federal Decree-Law No. 47 of 2022, as amended, Articles 51 and 53 (registration and tax returns for Taxable Persons)

Frequently asked questions

Our revenue was AED 3,200,000 in 2024 but AED 2,500,000 in 2025. Can we elect for 2025?

No. Ministerial Decision No. 73 of 2023 bars the election if revenue exceeded AED 3,000,000 in any relevant or previous tax period.

Can a free zone company use Small Business Relief?

Not if it is a Qualifying Free Zone Person. A free zone company that is not a Qualifying Free Zone Person and meets the other conditions can.

Related terms

Taxable person · Resident person · Tax loss relief · Qualifying Free Zone Person · Exempt income. See every term in the UAE tax glossary.

For the full picture, read our guide: Corporate Tax 2026: What UAE SMEs Need to Know About SBR.

Work it out with our free Small Business Relief checker.

Need help with Corporate Tax filing? See our Corporate Tax filing service.