In November 2024, the UAE Federal Tax Authority (FTA) issued guidance on how to complete the sections of a corporate tax return. This guidance sets out thresholds for disclosure of transactions with interdependent and related parties.

Transactions with related parties

If in the current tax period a company has entered into transactions with related parties and the aggregate value of all transactions with all related parties recognized in the financial statements at market value exceed AED 40 million, it is necessary to fill in a special section of the declaration – Related Party Transaction Schedule.

Taxpayer must also disclose information on income/expense categories for each related party if the aggregate value of such transactions exceeds AED 4 million. Dividends are not subject to this requirement.

Individual taxpayers, when exceeding the established financial thresholds, are required to file a Master File and a Local File. This requirement applies to the following companies:

• Companies belonging to an international group of companies (IGC) with annual consolidated revenue of 3,15 billion AED or more; and/or

• Companies with revenue of more than AED 200 million in the relevant tax period.

Additionally, an IGC member company may have an obligation to provide a Country-by-Country report if that company is a parent company or a company responsible for preparation of such report.

Transactions with connected persons

If in the current tax period a company has entered into transactions with connected persons with an aggregate value of transactions with at least one connected person exceeding AED 500 000, it is necessary to fill in a special section of the declaration – Connected Persons Schedule.

In this case, taxpayers disclose information not about all transactions, but only where the total income/expenses exceed AED 500 000 with one connected person (together with their related parties).

WHAT DO WE OFFER?

ALPINE GROUP specialists will provide qualified support on the following issues:

• Analysis of the current business structure for the identification of TCO risks;

• Analysis of the current and forecasted international transactions between related parties for compliance with the TCO rules and recommendations to align the terms of those transactions with the UAE legislation;

• TCO reporting preparation;

• Consultation on specific transfer pricing issues.

You can contact us by email or phone if you have any questions.

info@aigroup.ae 
+971 4 575 63 24