The United Arab Emirates has extended the availability of Small Business Relief (SBR) for eligible businesses for an additional two years, providing continued Corporate Tax relief until 31 December 2029.
The extension comes under Ministerial Decision No. 131 of 2026, which amends certain provisions of Ministerial Decision No. 73 of 2023 on Small Business Relief for the purposes of Federal Decree-Law No. 47 of 2022 on the Taxation of Corporations and Businesses. The decision was published in August 2026.
The amendment provides additional certainty for small businesses that were previously expecting the Small Business Relief regime to end after the 2026 tax period.
Small Business Relief Extended Until 31 December 2029
Small Business Relief was introduced as part of the UAE Corporate Tax framework to reduce the compliance and tax burden for qualifying small businesses.
Under the previous provisions, the relief was available for eligible Tax Periods ending on or before 31 December 2026. Ministerial Decision No. 131 of 2026 extends this period by two years, allowing qualifying businesses to continue benefiting from the relief for Tax Periods ending on or before 31 December 2029.
This extension gives eligible small businesses additional time to benefit from the relief and plan their Corporate Tax affairs.
What Is Small Business Relief in the UAE?
Small Business Relief is a Corporate Tax relief mechanism available to eligible UAE Resident Persons that meet the prescribed conditions.
Where the requirements are satisfied and the taxpayer elects to apply the relief, the taxpayer is treated as having no Taxable Income for the relevant Tax Period for Corporate Tax purposes.
The regime was introduced under Article 21 of Federal Decree-Law No. 47 of 2022, with further conditions and rules provided under Ministerial Decision No. 73 of 2023.
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Contact the team at Farahat & Co. for professional support and expert insights for businesses operating in the UAE.
What Has Changed Under Ministerial Decision No. 131 of 2026?
The key change introduced by Ministerial Decision No. 131 of 2026 is the extension of the Small Business Relief period.
| Position | Small Business Relief available for eligible Tax Periods ending on or before |
|---|---|
| Previous Position | 31 December 2026 |
| New Position | 31 December 2029 |
This means qualifying businesses may continue to consider Small Business Relief for the additional tax periods covered by the amended legislation, subject to meeting all applicable eligibility conditions.
Who Can Benefit from Small Business Relief?
The extension does not mean that every UAE business automatically qualifies for Small Business Relief.
Businesses must continue to assess their eligibility against the conditions prescribed under the UAE Corporate Tax legislation and the relevant Ministerial Decisions.
One of the key conditions under the existing Small Business Relief framework is the applicable revenue threshold of AED 3 million for the relevant Tax Period and the prescribed previous Tax Periods.
Other conditions and exclusions also apply. For example, the relief is subject to specific rules concerning businesses that are part of certain multinational enterprise groups and Qualifying Free Zone Persons.
Businesses should therefore review their individual circumstances before electing for the relief.
Related: Corporate Tax Consultants UAE
Does the Extension Mean Businesses Do Not Need to Register for Corporate Tax?
The short answer is no.
The extension of Small Business Relief does not remove Corporate Tax registration or other applicable compliance obligations.
Eligible businesses must continue to comply with the UAE Corporate Tax registration, filing and record-keeping requirements applicable to them.
Small Business Relief is a tax relief mechanism; it is not an exemption from the UAE Corporate Tax system itself.
Why Is the Extension Important for UAE Businesses?
The extension provides greater certainty for small and emerging businesses operating in the UAE.
Businesses that previously expected the relief to end after 2026 can now consider the impact of the extended period when preparing their financial, tax and compliance plans.
The additional two years may also provide qualifying businesses with more time to adapt their accounting systems, financial reporting processes and Corporate Tax compliance procedures.
Also check: Corporate Tax Services in UAE
What Should Businesses Do Now?
Businesses should not assume that the extension automatically applies to them. Instead, eligible businesses should:
- Review the updated provisions introduced by Ministerial Decision No. 131 of 2026
- Confirm whether they satisfy the Small Business Relief eligibility conditions
- Review their revenue for the relevant Tax Periods
- Determine whether any exclusion applies to their business
- Ensure that their Corporate Tax registration and filing obligations remain up to date
- Consider whether electing for Small Business Relief is appropriate based on their current and expected tax position
- Maintain appropriate financial records and supporting documentation
The amendment to the Small Business Relief provisions should be considered together with the applicable commencement and eligibility requirements. In particular, businesses should review whether the relevant provisions apply to their Tax Period based on the stated commencement date of the amended legislation.
UAE Small Business Relief Extended Until 2029
Ministerial Decision No. 131 of 2026 extends the availability of Small Business Relief until 31 December 2029, giving qualifying businesses additional time to benefit from the relief, subject to the applicable conditions.
Businesses should review the amended provisions and their individual circumstances to determine whether they qualify and what action is required for their Corporate Tax compliance.
How Farahat & Co. Can Help
Understanding whether a business qualifies for Small Business Relief requires an assessment of its revenue, Tax Period, legal structure and other applicable conditions.
Farahat & Co. can assist businesses in reviewing their Corporate Tax position, assessing Small Business Relief eligibility, understanding the impact of the 2026 amendment and maintaining compliance with UAE Corporate Tax requirements.
Businesses that are uncertain about their eligibility or the application of the extended relief should seek professional tax advice before making their Small Business Relief election.
Contact Farahat & Co. today to discuss your Small Business Relief eligibility and Corporate Tax requirements.
Need Expert Advice?
Contact the team at Farahat & Co. for professional support and expert insights for businesses operating in the UAE.
