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Transfer Pricing Support in Dubai, UAE
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Understanding Transfer Pricing Support in the UAE
Who Needs UAE Corporate Tax Transfer Pricing Support?
UAE businesses with transactions involving Related Parties or Connected Persons may need transfer pricing support. Related Party transactions are subject to the arm’s-length principle (pricing as if the parties were independent), while payments or benefits to Connected Persons are subject to the market-value rules in Article 36. The need for disclosures or formal documentation depends on the nature and value of the transactions and the business’s wider Corporate Tax position.
- Multinational subsidiaries operating in the UAE
- UAE holding companies and entities within local groups
- Businesses paying or receiving management or service charges
- Companies with intercompany loans, guarantees or other financing
- Businesses transferring goods, intellectual property or other assets within a group
- Companies making payments or providing benefits to owners, directors or other Connected Persons
- Free Zone and mainland entities with related-party transactions
What Does CT Transfer Pricing Support Include?
CT Transfer Pricing Support covers the identification, review, documentation and Corporate Tax reporting of transactions with Related Parties and Connected Persons. Beaufort Associates coordinates the engagement and integrates the specialist partner firm’s transfer pricing work with the client’s accounts and Corporate Tax compliance.
- Related Party and Connected Person identification
- Controlled transaction mapping and materiality review
- Functional, asset and risk analysis where required
- Review of intercompany pricing policies and charging mechanisms
- Selection and application of an appropriate transfer pricing method
- Benchmarking studies where required
- Review of management fees, service charges and cost allocations
- Intercompany financing and loan pricing review
- Master file and local file support where the statutory thresholds are met
- Corporate Tax Related Party and Connected Person schedule support
- Review of intercompany agreements and supporting records
- Support in responding to transfer pricing information requests from the Federal Tax Authority
UAE Corporate Tax Transfer Pricing: Key Technical Questions
Do UAE Transfer Pricing Rules Apply to Domestic and Cross-Border Transactions?
Yes. UAE Corporate Tax transfer pricing rules can apply to transactions and arrangements with Related Parties and Connected Persons whether the other party is in the UAE mainland, a Free Zone or another country. The location of the other party does not, by itself, remove the applicable arm’s-length or Connected Person market-value requirements.
The rules are therefore relevant not only to multinational groups but also to UAE groups with transactions between entities under common ownership or control. Common examples include sales of goods, management charges, shared services, royalties, loans, guarantees and transfers of assets.
Related Parties are defined under the Corporate Tax Law and can include entities linked through ownership, control or certain family relationships. Connected Persons are a separate category and generally include an owner, director or officer of the business and their Related Parties (Articles 35 and 36, Federal Decree-Law No. 47 of 2022, as amended).
How Does the UAE Arm’s-Length Principle Apply to Related-Party Transactions?
A transaction between Related Parties should be priced as if it had been agreed between independent parties under comparable circumstances. The UAE Corporate Tax Law requires the result of the transaction or arrangement to be consistent with the arm’s-length standard (Article 34, Federal Decree-Law No. 47 of 2022, as amended).
The analysis normally considers the contractual terms, the functions performed, assets used, risks assumed, characteristics of the goods or services, economic circumstances and business strategies. The written agreement is a starting point, but the FTA Transfer Pricing Guide explains that the actual conduct of the parties is important where it differs from the contract.
Depending on the transaction, the specialist analysis may use a recognised transfer pricing method and benchmarking evidence to support the arm’s-length outcome.
When Must Related-Party Transactions Be Disclosed in a UAE Corporate Tax Return?
The Related Party schedule must generally be completed where the aggregate value of transactions with all Related Parties in the Tax Period exceeds AED 40 million. Once that threshold is exceeded, a transaction category must generally be disclosed where its aggregate value with all Related Parties exceeds AED 4 million.
The FTA Corporate Tax Returns Guide requires income and expenditure to be reported separately and asks for details including the Related Party, transaction type and arm’s-length value. Dividends declared between Related Parties are excluded from the AED 40 million and AED 4 million thresholds for this schedule.
A business should therefore reconcile its related-party ledger and transaction categories before filing rather than waiting until the return is being finalised.
When Must Connected-Person Transactions Be Disclosed in a UAE Corporate Tax Return?
The Connected Person schedule is triggered where the aggregate value of transactions with Connected Persons, including their Related Parties, exceeds AED 500,000 in the Tax Period. The schedule then requires disclosure for each Connected Person where the aggregate payment or benefit to that person and their Related Parties exceeds AED 500,000.
Connected Persons are different from Related Parties. They generally include an owner of the business, a director or officer, and a Related Party of any of those persons (Article 36, Federal Decree-Law No. 47 of 2022, as amended).
Payments such as director remuneration, owner benefits or other amounts involving Connected Persons should therefore be identified early and reconciled to the accounts before the Corporate Tax return is submitted.
When Are a Master File and Local File Required Under UAE Corporate Tax?
A Taxable Person (a person subject to UAE Corporate Tax) must maintain a master file and local file where its revenue for the relevant Tax Period is at least AED 200 million, or where it is part of a multinational enterprise group with consolidated group revenue of at least AED 3.15 billion in the relevant Tax Period (Article 2, Ministerial Decision No. 97 of 2023).
These thresholds determine the formal master file and local file requirement; they do not determine whether the arm’s-length principle applies. A business below the documentation thresholds can still have related-party pricing obligations and Corporate Tax return disclosure requirements.
The local file does not automatically include every transaction with every Related Party. Ministerial Decision No. 97 of 2023 specifies which transactions and counterparties are included or excluded, so the scope should be assessed before preparing the file.
What Transfer Pricing Documents Can the FTA Request From a UAE Business?
The FTA can request transfer pricing information and supporting documentation, and a Taxable Person that is required to maintain a master file and local file may need to provide them within 30 days of an FTA request, or within a longer period agreed by the FTA (Article 55, Federal Decree-Law No. 47 of 2022, as amended).
The supporting records may include group structure information, intercompany agreements, transaction values, functional analysis, transfer pricing method selection, benchmarking, financial information and explanations of material assumptions. The documentation should support both the pricing policy and the actual amounts recorded in the financial statements.
Maintaining contemporaneous records is generally more practical than reconstructing the pricing rationale after an FTA request is received.
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Frequently Asked Questions
Yes. UAE transfer pricing rules can apply to domestic transactions between Related Parties and Connected Persons as well as cross-border transactions. The parties being located in the UAE does not, by itself, remove the applicable arm’s-length or Connected Person market-value requirements.
No. A master file and local file are required only where the applicable thresholds are met. However, a business below those thresholds can still be required to apply the arm’s-length principle and complete Corporate Tax return disclosures.
No. The AED 200 million revenue threshold relates to the formal master file and local file requirement. Transfer pricing rules can apply to Related Party and Connected Person transactions even where the business is below that threshold.
The Related Party schedule generally applies where aggregate transactions with all Related Parties exceed AED 40 million in the Tax Period. Once that threshold is exceeded, transaction categories exceeding AED 4 million generally need to be disclosed.
This page sets out our understanding of UAE corporate tax based on the legislation and guidance in force at the date of last review. The position may change, and the application to a particular set of facts may require further analysis. Nothing on this page constitutes professional, legal or tax advice. Beaufort Associates accepts no liability for action taken or not taken in reliance on this page. Please contact us for advice tailored to your circumstances.
Reviewed by: Shahid Mahmood Khan, CPA - Manager at Beaufort Associates with two decades' experience in accounting, audit, VAT and Corporate Tax across the UAE and Pakistan.
Last reviewed: 20 October 2026 · Next scheduled review: 20 April 2027
This page provides general information on UAE Corporate Tax. It does not constitute professional advice. Please contact us for advice tailored to your circumstances. See our full Terms of Use.
Sources
Primary sources referenced on this page:
- Federal Decree-Law No. 47 of 2022 on the Taxation of Corporations and Businesses and its amendments
- Ministerial Decision No. 97 of 2023 on the Requirements for Maintaining Transfer Pricing Documentation
- Federal Tax Authority - Corporate Tax Guide: Small Business Relief | CTGSBR1
- Federal Tax Authority - Corporate Tax FAQs
- Ministerial Decision No. 131 of 2026 Amending Certain Provisions of Ministerial Decision No. 73 of 2023 on Small Business Relief
- Federal Tax Authority - CTP010: Clarification of Director and Officer
- Federal Tax Authority - Public Clarification: Downward adjustments made by a Taxable Person in the Tax Return to comply with the Corporate Tax Law
We have referenced the legislation in force as at the last review date. The UAE tax framework is evolving; later changes may affect the position. Speak with us for advice on your specific circumstances.
