UAE extends small business corporate tax relief to the end of 2029
Companies with annual revenue up to AED 3 million keep their corporate tax exemption until 31 December 2029. SMEs are roughly 94% of all UAE companies and over 60% of non-oil GDP. What the extension means for entrepreneurs — and for the office market.
The UAE Ministry of Finance has extended Small Business Relief until 31 December 2029: companies with annual revenue up to AED 3 million (about $820,000) can continue paying no corporate tax. In a country where small and medium businesses are roughly 94% of all companies and more than 60% of non-oil GDP, this is the tax event of the year.
Context: there is a tax, but not for everyone
When the UAE introduced its 9% corporate tax in 2023, entrepreneurs' main fear was not the rate but the trend: once it starts, it only tightens. Extending the relief for several more years answers exactly that fear. The system is proving predictable: large, established businesses pay; young ventures get room to grow.
- Up to AED 3m annual revenue — the exemption threshold.
- Until 31 December 2029 — the new expiry date.
- 9% — the standard corporate rate for those who outgrow the relief; for comparison, typical European rates run two to three times higher.
What it means in practice
Tax saved by a small company does not sit in a bank account — it goes into working capital: inventory, marketing, hiring. The relief works as a standing growth stimulus, and its extension extends the whole cycle: new licences, new employees, new offices.
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This is where the news meets the office market, where vacancy is down to 6.1%: a good share of Grade B office demand comes precisely from companies growing under this relief. Tax predictability through 2029 means predictability of that demand too.
If you are considering moving a business
- Count revenue, not profit. The threshold is tied to turnover: a services business under AED 3m qualifies outright; a trading business with big volumes does not.
- Planning horizon: three-plus years. The rules are fixed to the end of 2029 — rare certainty by current standards anywhere.
- Relief is not exemption from filing. Tax registration and returns remain mandatory for exempt companies: the relief is claimed in the return, not instead of it.
Based on announcements by the UAE Ministry of Finance.