Country by Country Reporting (CbCR) in the UAE: A Complete Guide

What Is Country by Country Reporting (CbCR) in the UAE?

Country by Country Reporting (CbCR) in the UAE was introduced under Cabinet Resolution No. 32 of 2019, later amended by Cabinet Resolution No. 44 of 2020. Both instruments implement the Organisation for Economic Co-operation and Development’s (OECD) Base Erosion and Profit Shifting (BEPS) Action 13 standard, which requires large multinational enterprise (MNE) groups to disclose, jurisdiction by jurisdiction, where they earn revenue, book profit, and pay tax. The goal is transparency: tax authorities across the group’s operating countries can see whether profit is being reported where real economic activity actually happens.

CbCR is a filing obligation, not a tax itself. It sits alongside Corporate Tax and transfer pricing documentation as one of three related but separate compliance tracks that a large UAE-headquartered group has to manage in parallel.

Who Must Comply: CbCR Applicability in the UAE

The CbCR requirements apply to an entity that is:

• A tax resident in the UAE, meaning it was incorporated in the UAE or has its place of effective management there, and
• Part of a multinational group of enterprises with consolidated group revenue equal to or exceeding AED 3.15 billion (roughly USD 858 million) in the financial year immediately before the reporting year in question.

MNE Groups headquartered in the UAE with financial reporting years beginning on or after 1 January 2019 fall within scope. Because the AED 3.15 billion figure is tested every year against the group’s consolidated revenue, a group’s CbCR obligation is not fixed once and forgotten. A group that crosses the threshold for the first time must notify the Ministry of Finance (MoF) for that reporting year even if it was never in scope before, and a group that falls back under the threshold in a later year is not automatically excused unless the drop is sustained and properly documented.

CbCR Notification and Reporting Deadlines in the UAE

CbCR Notification

The notification is filed by the Ultimate Parent Entity of the MNE Group (or, in some structures, a Surrogate Parent Entity) confirming that the CbCR criteria apply and identifying which entity in the group will submit the CbC Report. The notification must reach the MoF no later than the last day of the MNE Group’s financial reporting year. For example, if the group’s financial year runs from 1 January 2026 to 31 December 2026, the notification is due by 31 December 2026, not after year end.

CbC Report

The CbC Report itself contains quantitative and qualitative data on the group: revenue, profit before tax, income tax paid and accrued, stated capital, accumulated earnings, number of employees, and tangible assets, broken down by tax jurisdiction, plus a description of each constituent entity’s main business activities. The report is due within 12 months of the end of the group’s reporting year. Continuing the example above, a group with a financial year ending 31 December 2026 must submit its CbC Report by 31 December 2027.

The notification and the report are two separate filings with two separate deadlines. Filing the report on time does not excuse a late or missing notification, and vice versa.

Penalties for CbCR Non-Compliance in the UAE

Cabinet Resolution No. 32 of 2019 sets out four distinct administrative penalties for UAE tax-resident entities that fail to meet their CbCR notification and reporting obligations:

These penalties apply per violation, so a group that both misses its notification deadline and later submits an incomplete report can face more than one fine for the same reporting cycle.

Who Qualifies as a UAE Tax Resident Entity for CbCR Purposes

Under UAE domestic law and the UAE’s network of international tax treaties, an entity is treated as a UAE tax resident for CbCR purposes if it was incorporated or established in the UAE, or if it has its place of effective management in the UAE, meaning the location where key management and commercial decisions are actually made rather than where the entity is merely registered. This distinction matters for groups with a UAE holding entity but decision-making functions based elsewhere: effective management, not just the certificate of incorporation, determines whether the UAE entity is the one obligated to notify and report.

CbCR Penalty Appeal Procedure in the UAE

Where the MoF identifies non-compliance, the process runs in a set sequence:

1. The MoF identifies the instance of non-compliance.
2. The MoF notifies the entity and allows a 14-day grace period to correct the position.
3. If the entity does not comply or cannot provide a justifiable explanation, the MoF issues a formal penalty notice.
4. The entity may file an appeal within 30 business days, or pay the fine within 30 days.
5. The MoF’s appeal committee must decide whether to accept or reject the appeal within 60 days.
6. If the appeal is rejected, the entity must settle the fine within 30 business days.

Related: Tax Dispute Resolution Services in UAE

Because the appeal window is short and the evidentiary burden sits with the entity, groups that intend to contest a penalty are better served preparing supporting documentation before the 14-day grace period expires, rather than after a formal notice is issued.

CbCR, Transfer Pricing Documentation and Corporate Tax: How the Rules Connect

CbCR does not exist in isolation. It shares thresholds and underlying data with two other UAE compliance obligations, and groups frequently underestimate how closely the three are linked.

Also check: Transfer Pricing Services in Dubai, UAE

The overlap in the AED 3.15 billion figure is not a coincidence: both the CbCR threshold and the Master File threshold trace back to the same OECD group-revenue benchmark. In practice, a group large enough to trigger CbCR is almost always also required to maintain a Transfer Pricing Master File, and its individual UAE entities are separately tested against the AED 4 million Local File threshold on their own related-party transactions. Treating these as one combined compliance exercise, rather than three disconnected filings handled by different teams, is what keeps the underlying financial figures consistent across all three submissions, which is exactly what the FTA and MoF cross-check for.

UAE Domestic Minimum Top-up Tax (DMTT) and Its Link to CbCR

Since financial years starting on or after 1 January 2025, the UAE has applied a Domestic Minimum Top-up Tax (DMTT) under Cabinet Decision No. 142 of 2024, implementing the OECD’s Pillar Two framework. The DMTT sets a 15% minimum effective tax rate on the UAE operations of in-scope MNE groups, those with consolidated global revenue of EUR 750 million or more in at least two of the preceding four fiscal years.

This is the same OECD revenue benchmark that underpins the AED 3.15 billion CbCR threshold, converted from euros to dirhams. A UAE-headquartered group already filing CbC Reports is, in most cases, either already in scope for DMTT or close enough to the boundary that it needs to check every year. The CbC Report’s jurisdiction-by-jurisdiction breakdown of revenue, profit and tax paid is one of the core data sources used to test whether the group’s effective UAE tax rate sits below 15%, which is what triggers a top-up liability. Groups that treat CbCR purely as a disclosure exercise, disconnected from their DMTT position, risk discovering a top-up tax liability only after their CbC Report has already been filed and the underlying numbers are locked in.

Must check: International Tax Advisor in Dubai, UAE

Common Mistakes UAE MNE Groups Make with CbCR Compliance

Most CbCR penalties issued in the UAE trace back to a small number of recurring, avoidable errors:

• Treating the notification and the report as one deadline. The notification is due by the last day of the financial year; the report is due 12 months later. Groups that plan only around the report deadline routinely miss the earlier notification date.
• Assuming CbCR only applies to inbound, foreign-headquartered groups. Any UAE-incorporated Ultimate Parent Entity of a qualifying MNE Group must notify and report, regardless of where the group’s other operations sit.
• Not re-testing the AED 3.15 billion threshold annually. A group that was previously below the threshold and crosses it in the current financial year has a fresh obligation for that year, even if no prior filing was ever required.
• Discarding supporting records once the report is filed. The 5-year retention requirement runs from the date the CbCR is submitted, not from the end of the financial year it covers.
• Assuming Transfer Pricing documentation satisfies CbCR, or the reverse. They are separate filings with the MoF and rely on overlapping but distinct data sets, as set out in the comparison above.

As a worked example: a UAE-headquartered group with consolidated 2026 revenue of AED 3.4 billion crosses the CbCR threshold for the first time. Its Ultimate Parent Entity must notify the MoF by 31 December 2026, the last day of that financial year, and file the full CbC Report by 31 December 2027. If the group instead waits until the report deadline to notify, it has already missed the notification date by 12 months, exposing it to the AED 1,000,000 penalty plus daily accrual, even though the eventual report itself may be complete and accurate.

How Farahat & Co. Can Help

Farahat & Co. supports UAE-headquartered MNE Groups with CbCR threshold testing, notification and CbC Report preparation, and aligning that data with Transfer Pricing Master File, Local File and Corporate Tax filings so the figures reported to the Ministry of Finance and the Federal Tax Authority stay consistent.

Contact Farahat & Co. today to discuss your Country by Country Reporting requirements.