The implementation of corporate tax in the UAE has increased transparency and created a more disciplined regulatory environment for businesses. One of the main compliance requirements under Ministerial Decision No. 84 of 2025 is the preparation and maintenance of an audited financial statement in Dubai. The UAE Federal Tax Authority stresses that tax compliance is mandatory, and companies must keep proper records, meet tax filing deadlines, and cooperate with auditors.
In 2026, businesses operating in the UAE must understand their obligations under the Corporate Tax framework regarding audited financial statements. Ministerial Decision No. 84 of 2025 clarifies the requirements for taxable persons, Qualifying Free Zone Persons (QFZPs) and Tax Groups. Accurately integrating exemptions and thresholds is crucial in the 2026 tax year. A small mistake in classification may lead to penalties or missed tax benefits. This is where auditors in Dubai play a role. Partnering with a leading auditing firm in the UAE, such as Jaxa Chartered Accountants, which provides the best auditing services in the UAE, ensures your audit process is handled accurately by evaluating the business structure, determining the correct audit requirements for 2026 and beyond, and ensuring 100% compliance with UAE FTA regulations.
UAE Audit Requirement Breakdown: Who Must Maintain an Audited Financial Statement?
Under Ministerial Decision No. 84 of 2025, the UAE Corporate Tax Law defines which businesses must prepare and maintain audited financial statements. Audited financial statements in the UAE are mandatory for specific entities, and meeting audit requirements is vital for preparing UAE corporate tax returns in 2026.
Article 2 of the Ministerial Decision No. 84 of 2025 mandates audited financial statements for:
- Any taxable person (not a part of a tax Group) with an annual revenue exceeding AED 50 million.
- A Qualifying Free Zone Person.
Maintaining audited financial statements is not optional, but it is a legal obligation for these businesses.
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Mandatory Audit for revenue over AED 50 million:
Any taxable person, including any business or natural person earning revenue exceeding AED 50 million during the tax period, provided it is not registered as a Tax Group, must prepare a mandatory audited financial statement as per the UAE corporate tax law.
For a non-resident person, only revenue connected to the Permanent Establishment or nexus is considered when determining whether the AED 50 million threshold has been crossed.
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Mandatory Audit for Qualifying Free Zone Persons (QFZPs)
A Qualifying Free Zone Person (QFZP) is a Free Zone company eligible for 0% corporate tax rate on Qualifying income. Every QFZP must prepare an audited financial statement regardless of revenue or size of business to maintain its status.
This mandatory audit is necessary to validate:
- Compliance with Economic Substance
- Accurate identification and reporting of Qualifying income
- Adherence to the De-Minimis threshold
Even small Free Zone entities with low revenue must undergo a statutory audit to avail the benefit of the 0% Corporate tax regime.
To stay fully compliant, rely on the best auditing and accounting firm in the UAE, such as Jax, which specializes in preparing financial statements. This ensures maintaining QFZP eligibility and meeting UAE corporate tax regulations.
What is the Importance of preparing an audited financial statement in the UAE?
- Ensure financial reporting is accurate, reliable, and transparent to avoid the UAE FTA
- Strengthen trust and credibility with investors, banks, and regulatory bodies.
- Ensure audited financial statements adhere to IFRS or IFRS for SMEs.
- Helps improve business operations by identifying inefficiencies, gaps, and risks.
- Confirm the eligibility for key tax benefits such as QFZP status.
Audit Compliance Challenges Under UAE Corporate Tax
- Disorganized Books and records make it difficult to verify balances.
- Incorrect application of IFRS standards leading to misstatement and compliance issues.
- Unsupported Accounting Estimates, such as depreciation, revenue, and provisions.
- Missing required disclosures on loans, related parties, or contingent liabilities.
- Lack of awareness of mandatory audit rules, especially under the UAE Corporate Tax Law.
Which Entities are not required from Audited Financial Statements as per the Corporate Tax Law in the UAE
The following entities are not required to maintain audited financial statements in the UAE.
- Businesses with annual revenue below AED 50 million: Any taxable person that are not memebers of a Tax Group, with a annual revenue below AED 50 million, does not fall within the revenue-based audit requirement under Ministerial Decision No. 84 of 2025 under the UAE corporate tax law. However, other applicable legal, regulatory or contractual requirements may still require audited financial statements.
- Non-Qualifying Free Zone Persons (Non-QFZPs): Non-Qualifying Free Zone Persons are subject to 9% corporate tax; such free zones are not required to maintain audited financial statements in the UAE.
- Individual Members of a Tax Group: Individual entities in a tax group are not required to prepare separate audited financial statements, as the tax group submits a consolidated Special Purpose Financial Statement (SPFS) in accordance with the applicable Federal Tax Authority (FTA) requirements.
- Non-resident persons without a UAE Permanent Establishment or Nexus (PE): Non-resident entities that have no PE or nexus in the UAE are not required to maintain audited financial statements in the UAE.
How Can Businesses Prepare for a UAE Corporate Tax Audit?
Preparing in advance can reduce delays and help identify accounting issues before the audit begins.
Businesses should consider the following steps:
1. Maintain Accurate Accounting Records
Record income, expenses, assets, liabilities and business transactions accurately. Ensure that accounting entries are supported by appropriate documentation.
2. Reconcile Bank Accounts and Ledgers
Regularly reconcile bank statements, receivables, payables and general ledger balances. Investigate and resolve discrepancies before the audit.
3. Organise Supporting Documents
Keep invoices, receipts, contracts, payroll records, bank statements and other relevant supporting documents properly organised and accessible.
4. Review Corporate Tax Treatment
Review the treatment of income, expenses, related-party transactions and other relevant items under the UAE Corporate Tax rules. Confirm that the accounting information used for tax reporting is consistent with the applicable tax requirements.
5. Confirm the Applicable Financial Reporting Framework
Determine which accounting standards and reporting framework apply to the business. Tax Groups should specifically review the requirements for audited aggregated financial statements and the relevant FTA guidance.
6. Engage a Qualified Audit Firm
Work with an appropriately qualified and registered auditor who understands UAE financial reporting and Corporate Tax requirements. Early engagement gives businesses more time to address documentation gaps and reporting issues.
Stay Compliant in 2026 with Jaxa’s Expert Guidance
As UAE compliance standards continue to tighten, maintaining audited financial statements is no longer optional – it is a strategic necessity. Engaging with an auditing and accounting firm in the UAE and UAE FTA tax agent– Jaxa Chartered Accountants ensures businesses meet every auditing requirement with accuracy, transparency, and reliability. Jaxa delivers the best auditing services in the UAE.
Our key differentiators:
- Specialists in IFRS-Compliant Financial Statements
- End-to-End Financial Statement Preparation & Review
- UAE FTA tax agent support
- 100% accuracy and transparency
With 19+ years of auditing excellence, our expert auditors in Dubai handle the preparation and review of financial statements as per IFRS standards while meeting UAE corporate tax and VAT compliance.
JAXA is an approved auditor for relevant UAE jurisdictions, including RAKEZ, DIFC, DMCC, JAFZA, IFZA and Meydan, subject to the applicable jurisdiction-specific requirements.
We manage the end-to-end audit process to help businesses maintain records through robust cloud accounting tools while providing strategic financial insights that support scalability and long-term business performance.
Get Your Financial Statements Audit-Ready: Speak to our Jaxa Experts
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