The UAE Ministry of Finance has issued Ministerial Decision No. 84 of 2025, replacing earlier guidance and raising transparency standards for corporate tax reporting. The new rules apply to all tax periods commencing on or after 1 January 2025, and businesses need to understand the key changes now.
What has changed
The decision introduces three significant updates to financial reporting requirements under the UAE Corporate Tax Law:
Tax Groups face new aggregation requirements. If your business operates as a tax group, you must now prepare audited special purpose aggregated financial statements specifically for corporate tax purposes. This replaces the previous requirement for standalone financial statements and is designed to streamline reporting across group structures. The Federal Tax Authority (FTA) will provide detailed implementation guidance.
Free Zone Distributors have additional compliance duties. Qualifying Free Zone Persons involved in distributing goods or materials within or from a Designated Zone must now comply with additional procedures to be announced by the FTA. This affects companies relying on free zone distribution activities.
Non-resident businesses face clearer audit thresholds. For non-resident persons calculating whether they meet the AED 50 million revenue threshold for audit requirements, only revenue derived through a Permanent Establishment or nexus in the UAE counts. This prevents confusion about which income triggers audit obligations.
What this means
- Immediate action for tax groups: Review your current financial reporting structure now. You will need to transition to aggregated special purpose statements for 2025 onwards, so plan ahead for audit and FTA coordination.
- Free zone companies must stay alert: Monitor FTA announcements for distribution-specific procedures. If you operate a free zone distribution business, compliance timelines may be tight once guidance is issued.
- Documentation matters more than ever: These rules signal the UAE's commitment to robust financial transparency. Ensure your records, revenue tracking, and tax positions are clearly documented—especially if you're a non-resident with UAE operations or part of a larger group.