The UAE Ministry of Finance has released Ministerial Decision No 131 of 2026, extending the availability of Small Business Relief to the tax period ending on or before December 31, 2029. This measure highlights that the UAE Ministry of Finance strengthened support for small businesses and start-ups while promoting entrepreneurship and creating a business-friendly environment that contributes to the UAE’s investment landscape.
Under the SBR latest amendment, an eligible UAE resident person with revenue of AED 3 million or less in a relevant tax period and applicable previous tax periods may elect for Small Business Relief, subject to meeting all prescribed conditions. Where SBR is validly elected, the business is treated as having no taxable income for the relevant tax period. Eligible businesses must continue to meet their applicable UAE corporate registration, return filing, and record-keeping requirements. This relief is currently available for the Tax Period ending on or before 31 December 2026.
What has changed with the 2029 SBR Extension?
The UAE Ministry of Finance has extended the Small Business Relief (SBR), giving eligible businesses an additional three years to benefit from the relief.
| Previous Rule | Latest Update |
| SBR available for Tax periods ending on or before December 31, 2026 | SBR now available for Tax Periods ending on or before December 31, 2029 |
| Relief available for a limited period | A three-year extension provides a longer benefit period |
| Existing eligibility conditions applied | Existing eligibility conditions continue to apply. No amendments in this. |
The key change is the extension of the SBR availability period. Business must continue to meet the applicable requirements and make the required election to benefit from the relief.
What is Small Business Relief Under UAE Corporate Tax?
Small Business Relief (SBR) is a corporate tax relief introduced under Article 21 of Federal Decree-Law No. 47 of 2022 to support eligible small businesses in the UAE. It is designed to lower the corporate tax burden and compliance requirement for eligible small businesses that meet the prescribed conditions.
Those businesses that meet the applicable AED 3 million revenue threshold and other eligibility conduction can elect for SBR for the relevant period. When the relief is validly elected, the business is treated as having no taxable income for that tax period.
Note: SBR does not mean the business is exempt from UAE corporate tax compliance. Businesses must still meet corporate tax registration, return filing, and recordkeeping requirements.
Who is Eligible for Small Business Relief in the UAE?
A business must meet the prescribed conditions to elect for Small Business Relief under the UAE corporate Tax regulations:
- Revenue Limit: The revenue threshold must not exceed AED 3 million in the relevant tax period and all previous tax periods beginning on or after June 1, 2023. The revenue limit is determined at the entity level, rather than separately for individuals or business divisions.
- Excluded MNE Groups: Small business Relief is not available to businesses that are members of a Multinational Enterprise (MNE) Group with consolidated group revenue of AED 3.15 billion or more.
- UAE Resident Person: The business must qualify as a Resident person for UAE corporate Tax purpose.
- Not a QFZP: A Qualifying Free Zone Person (QFZP) cannot elect for Small Business Relief.
Claiming SBR without the eligibility conditions may result in additional corporate tax liability, applicable penalties and late-payment charges.
How to claim Small Business Relief after the 2029 Extension?
The latest extension allows eligible businesses to continue claiming Small Business Relief for tax Period on or before 31 December 2029.
Businesses should:
- Verify that eligible residents meet the AED 3 million revenue threshold and other SBR conditions.
- Maintain accurate financial and supporting documents
- Provide the required financial and revenue information through the FTA’s Emaratax portal.
- Elect for SBR when completing the UAE corporate tax return.
- Review the return filing and ensure it is submitted within the applicable filing deadline.
- Keep documentation that demonstrates eligibility and supports the information reported in the corporate tax return
The 2029 extension provides eligible small businesses with a longer period to benefit from SBR, but the existing eligibility and compliance requirements continue to apply. So, businesses should assess their eligibility carefully before claiming SBR.
Documents required for Small Business Relief (SBR) as per UAE Corporate tax
Businesses claiming Small Business Relief (SBR) should maintain sufficient records to demonstrate their eligibility and support informations reported in their corporate tax return.
Complete documentation is important if the FTA requests information or conducts a tax audit.
Important records include:
- Financial statements and accounting records showing the business’s revenue.
- Valid trade or business license showing the entity’s registration details
- UAE Corporate tax registration details and relevant FTA records
- Sales invoices and receipts supporting reported revenue
- Bank statement and other financial records that help substantiate business transactions
- Customer Contracts and commercial agreements supporting business transactions
- Corporate tax return and supporting schedules submitted to the FTA
- Other documents supporting SBR eligibility, where applicable
All documents should be clear, readable, and accessible for the UAE FTA audit. The UAE FTA may accept electronic records which are maintained in Arabic or English, and must be readable by the FTA or submitted with an approved translation.
What happens if a business incorrectly claims SBR?
Meeting the AED 3 million revenue threshold alone does not guarantee eligibility for Small Business Relief. Businesses should also consider the other conditions under the UAE corporate tax regime.
Consequences if incorrect claim includes:
- Additional corporate tax liability
- Late payment fines
- Applicable Tax penalties
- UAE FTA queries or audit
- Request for records and documentations
- Corrective filing requirement or compliance actions
The 2029 extension does not remove or relax the existing SBR conditions. Businesses should review their eligibility for each relevant tax period and maintain adequate records to support their claim.
Jaxa Auditors, an UAE FTA-approved tax agent with 19+ years of experience, can help you assess your SBR eligibility and stay compliant.
Why the 2029 SBR Extension Matters for UAE Businesses
- Extended opportunity: Eligible businesses can benefit from SBR for qualifying tax periods ending on or before December 31, 2029.
- Reduced tax burden: Qualifying businesses may benefit from SBR treatment when all conditions are met.
- Longer tax-planning horizon: Businesses have a longer timeframe to plan their corporate tax position within the applicable rules.
- Compliance remains important: Business continues meeting corporate tax filing, recordkeeping, and other applicable requirements.
- Regular reviews are recommended: businesses should reassess their eligibility as revenue, ownership, and business activities can affect SBR eligibility.
- Support for small businesses: The extension provides continued relief for qualifying entrepreneurs, start-ups, and smaller UAE businesses.
Claim Small Business Relief with Expert Jaxa Auditors
The extension of Small Business Relief gives qualifying businesses more time to benefit from UAE’s Corporate Tax Relief framework. However, determining eligibility and maintenance compliance requires careful review of the applicable conditions.
With 19+ years of experience in auditing and accounting excellence and status as an FTA-approved tax agent in the UAE, Jaxa Chartered Accountants helps businesses with:
- SBR eligibility assessment
- UAE Corporate tax registration
- UAE Corporate tax filings
- Preparing documents and records
- Regulatory Compliance
- UAE FTA tax advisory and representations
- Accounting and bookkeeping in the UAE
- SBR election support
- UAE VAT registration and filing support
- UAE corporate tax implementation
With the reported extension of Small Business Relief to 2029, businesses should review their tax position and ensure they meet the applicable requirements before claiming an SBR.
With the Small Business Relief now extended to 2029, our seasoned experts help your business understand the updated requirement and determine whether you qualify for the relief.
Navigate the 2029 SBR Extension with Jaxa Auditors.
If you need more updates on UAE corporate tax, visit our website for more details.
Reach us on WhatsApp