Transfer Pricing UAE: Who Must Comply (2026)

UAE transfer pricing reaches every related-party deal.

If your company deals with an owner, a sister company or a relative's business, the rule applies. Prices between you and them must match what strangers would agree. That holds from the first dirham. Only the paperwork grows with size.

For a company with a 31 December year-end, the FY2025 corporate tax return and its transfer pricing disclosure are due on 30 September 2026. This guide shows who must file what, which AED thresholds trigger each duty, and where advance pricing agreements stand.

For the pricing methods and the contents of each document, read our Transfer Pricing Rules in UAE guide. We do not repeat them here.

We checked each threshold below against the FTA's Transfer Pricing Guide or against two independent professional summaries (Deloitte, Grant Thornton, BDO).

What Is Transfer Pricing in the UAE?

Start with the rule itself.

Transfer pricing is the UAE rule that deals between related parties and connected persons must be priced as independent parties would price them. Article 34 of Federal Decree-Law No. 47 of 2022 sets it. The FTA's Transfer Pricing Guide treats an owner of 50% or more, or anyone who controls a company, as a related party.

Two groups sit inside the net. The law names them in Articles 35 and 36. The FTA's Transfer Pricing Guide (CTGTP1) explains both.

Source: FTA Transfer Pricing Guide (CTGTP1), sections 4.4.1 and 4.4.2.

Two rules follow from this.

First, every controlled transaction must be priced at arm's length. That covers goods, services, loans, and intellectual property.

Second, payments to a connected person are deductible only up to the arm's length price of what they provide. They must also be incurred wholly and exclusively for the business. Listed companies and entities under UAE regulatory oversight are carved out of that second rule.

Who Must Comply With Transfer Pricing Rules in the UAE?

Everyone with related parties, but paperwork scales.

Every UAE taxable person with related-party or connected-person deals must price at arm's length, whatever its size. Filing duties scale with value: a disclosure schedule above AED 40 million of related-party transactions, a connected-person schedule above AED 500,000, and a master file and local file at AED 200 million in revenue or AED 3.15 billion in group revenue.

The table shows each duty, its trigger and who it usually reaches.

Sources: FTA Transfer Pricing Guide (CTGTP1), section 6.6.3 and Ministerial Decision No. 97 of 2023 for the file thresholds. The AED 40 million, AED 4 million and AED 500,000 triggers come from the FTA's November 2024 corporate tax return guide, as summarised by Deloitte and Grant Thornton.

Read the thresholds carefully.

• The AED 40 million test counts everything. It adds up all related-party transactions in the period, whether booked in the financial statements or valued at market. Loans count too. A loan advance is an asset transaction for the lender and a liability transaction for the borrower, and repayments count as well.
• Categories follow. Once you pass AED 40 million, you list each category above AED 4 million. The categories are goods, services, intellectual property, interest, assets, liabilities and other. Dividends between related parties are left out.
• The AED 500,000 test adds people to their companies. An owner and a company the owner controls are added together.
• The master file has a limit. It applies only to groups with business outside the UAE. A UAE-headquartered group with no foreign operations prepares a local file only.

Below every threshold? You skip the schedules and the files, but not the rule. You must still keep reasonable records that support your prices. If the FTA asks, you have 30 days to produce them.

What Are the Transfer Pricing Deadlines in the UAE?

The clock starts at year-end.

The transfer pricing disclosure form is filed with the corporate tax return, due nine months after the tax period ends. A company with a 31 December year-end files its FY2025 return by 30 September 2026. Country-by-Country reports are due 12 months after year-end, and the FTA can demand a master file or local file with 30 days to respond.

Nine months after year-end gives these dates.

Each date is nine months after the tax period ends, as set out in the FTA Transfer Pricing Guide, section 6.5.

Four deadlines matter.

1. Disclosure form. It travels with the return. A late return means a late disclosure.
2. Master file and local file. Have them ready by the time you file. The FTA can ask for them later and gives you 30 days to hand them over.
3. Country-by-Country notification. The ultimate parent entity notifies the FTA by the last day of the fiscal year.
4. Country-by-Country report. It is due within 12 months of the reporting year-end, under Cabinet Resolution No. 44 of 2020.

Missing records carry a fixed penalty. Cabinet Decision No. 75 of 2023 sets AED 10,000 for a violation and AED 20,000 for a repeat within 24 months, as summarised by Grant Thornton.

The bigger cost is a re-pricing. If the FTA decides a deal was not at arm's length, it adjusts your taxable income and you owe the extra tax.

Unsure which schedule applies to you? A corporate tax consultant can map your related parties and test them against these thresholds. Find a corporate tax consultant on FindCPA →

Do Small Businesses and Free Zone Companies Need to Comply?

Small size helps. It does not exempt you.

Per the FTA's Transfer Pricing Guide, businesses that elect Small Business Relief (revenue up to AED 3 million) need not prepare transfer pricing documentation, but must still price at arm's length. Qualifying Free Zone Persons must confirm in their tax return that pricing is at arm's length and documentation exists.

Small Business Relief. The FTA Transfer Pricing Guide (section 4.4) says entities that elected the relief remain subject to the transfer pricing rules. They must meet the arm's length principle. They do not have to prepare or keep transfer pricing documentation. Our Small Business Relief guide covers who qualifies and the trade-offs.

Free zone companies. A Qualifying Free Zone Person must state in its return that its related-party transactions follow the arm's length principle. It must also confirm that its documentation meets Article 55, per Deloitte's summary of the FTA return guide.

A deal between a free zone company and a mainland affiliate counts, even though both are UAE entities. The two pay different tax rates, so the pricing decides where profit is taxed. Our free zone qualifying income guide shows how that income is classified.

Tax groups. Members of a registered tax group are treated as one taxable person, so deals inside the group are generally eliminated for transfer pricing. Deals with related parties outside the group still count. Read our tax grouping guide before you assume a group solves the problem.

Do Owner Pay, Rent and Shareholder Loans Count?

For owner-managed companies, yes.

Yes. An owner or director is a connected person, so payments and benefits to them are deductible only up to their arm's length price, and only if incurred wholly and exclusively for the business. The connected-person schedule starts at AED 500,000 per person and related parties, a low bar Deloitte says will make most companies itemise connected persons.

This is where small firms get caught. Picture a review of your return. It shows a large payment to a holding company you own. There is no contract and no market comparison behind it.

Four habits reduce your risk.

• Pay. Set owner and director pay at what an outsider in the same role would earn. Keep a note of how you decided.
• Rent. If an owner or an owner's company owns your premises, compare the rent with similar space. Keep the quotes.
• Loans. Loans to or from owners are controlled transactions. Test the interest rate, including a zero rate, against market terms.
• Family. Relatives up to the fourth degree are related parties. A supplier owned by a relative is in scope.

Sign a written agreement before the deal starts. Do not backdate it. The FTA expects documents made at the time, or at least before you file the return.

What Is the Status of Advance Pricing Agreements in the UAE?

APAs are open, but only for large deals.

The FTA published its Advance Pricing Agreement guide (CTGAPA1) on 31 December 2025. Only unilateral APAs are open. Applicants generally need at least AED 100 million of covered controlled transactions per tax period and pay a non-refundable AED 30,000 fee. An APA covers three to five future tax periods.

Article 59 of the Corporate Tax Law allows the programme. The FTA is rolling it out in phases. The table summarises the FTA's APA guide, as reported by BDO and Grant Thornton.

What this means for you. An APA is a large-group tool. A company with modest intercompany charges is nowhere near the bar.

The domestic case is worth watching. The guide lists deals between a Qualifying Free Zone Person and a mainland entity as eligible, because the parties pay different tax rates.

The FTA's December 2025 APA guide says the commencement date for cross-border unilateral APAs will be announced in 2026; it gives no start date for bilateral or multilateral APAs. Check the FTA's APA page for any later commencement announcement. If you read that the UAE has no working APA process, that advice predates December 2025.

What Changed in 2026 for Transfer Pricing Adjustments?

The FTA relaxed one rule in July.

In July 2026, FTA Public Clarification CTP011 confirmed that a taxable person can make a downward transfer pricing adjustment in its return without prior FTA approval. Every such adjustment must be disclosed whatever its value, and backed by a written rationale, benchmarking study, reconciliation and proof that the related party adjusted symmetrically.

Before CTP011, advisers read the FTA's November 2024 return guide as requiring an application first. Deloitte's summary said downward adjustments would be allowed only after a successful application to the FTA.

CTP011 removes that step and puts the burden of proof on you. Per BDO's summary of the FTA clarification, you must hold four items:

1. A commercial rationale for why the original accounting entries were not arm's length.
2. A full transfer pricing analysis, including a benchmarking study.
3. A reconciliation between the financial statements and the tax return.
4. Evidence that the related party made the matching adjustment.

Disclosure has no floor. A small downward adjustment on one intercompany recharge is disclosed even when you are below every other threshold.

That last item is the hard one. You cannot cut your own taxable income while the other side leaves its position alone. If the other party is overseas, its advisers must act in step with yours.

How Should You Prepare Before the Deadline?

Work backwards from the filing date.

Start with a list of related parties and connected persons, then total each group's transactions for the year against the AED 40 million, AED 4 million and AED 500,000 tests. Fix any price that is off arm's length before you close the books, then file the disclosure form with your corporate tax return on EmaraTax.

Deloitte advises finalising adjustments before the financial statements close. Doing so limits what you must enter by hand on the form.

Use this checklist.

1. List your related parties. Include owners of 50% or more, sister companies, relatives' businesses, directors and officers.
2. Total the year's deals with each. Count goods, services, intellectual property, interest, assets and liabilities. Include loan advances and repayments.
3. Compare the totals with the thresholds. Check AED 40 million, AED 4 million per category and AED 500,000 per connected person.
4. Test your prices. Gather market evidence and write down your reasoning. Correct any price that fails before you close the books.
5. Check your revenue. Compare your own revenue and your group's consolidated revenue with AED 200 million and AED 3.15 billion.
6. Paper the deals. Sign agreements for owner loans, rent, and services.
7. File. Submit the disclosure form with the corporate tax return by the due date.

If you cross any threshold, talk to a corporate tax consultant early. A defensible benchmarking study takes time to build.

Frequently Asked Questions

Do I need transfer pricing documentation for a small company?

Not usually. Master file and local file duties start at AED 200 million in your own revenue or AED 3.15 billion in group revenue, per the FTA's Transfer Pricing Guide. Smaller companies still price at arm's length, keep records that support their prices, and produce them within 30 days if the FTA asks.

Do I have to file the transfer pricing disclosure form?

Only if you cross a threshold or adjust your numbers. The related-party schedule starts above AED 40 million of transactions. The connected-person schedule starts above AED 500,000 per person and related parties. Any transfer pricing adjustment must be disclosed at any value. The form is filed with your corporate tax return.

Does transfer pricing apply between two UAE companies I own?

Yes. The rules cover domestic deals as well as cross-border ones, and the stakes are highest where the parties pay different tax rates, such as a mainland company dealing with a Qualifying Free Zone Person. Members of the same registered tax group are the main exception, because their internal deals are generally eliminated.

What is the penalty for not keeping transfer pricing records?

The fixed penalty is AED 10,000 for a first violation and AED 20,000 for a repeat within 24 months, under Cabinet Decision No. 75 of 2023. The larger cost is an FTA adjustment, which adds tax on the re-priced deal. Keep records made at the time of each transaction so you can defend your prices.

Can my company apply for an advance pricing agreement?

Only if the covered controlled transactions generally reach AED 100 million per tax period, and only for a unilateral APA for now. The FTA charges a non-refundable AED 30,000 fee and starts with a pre-filing consultation. Smaller companies get certainty by documenting prices at arm's length.

Keep Reading

• Transfer Pricing Rules in UAE: Documentation Guide
• Small Business Relief Under UAE Corporate Tax
• Corporate Tax Return Filing Guide
• Browse Corporate Tax Consultants on FindCPA

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