UAE Corporate Tax Filing 2025: Key Compliance Steps for Audit and Transfer Pricing Readiness

UAE businesses must complete audits, transfer pricing adjustments, and disclosures by September 30, 2025, to ensure Corporate Tax compliance. Early preparation and expert engagement are crucial to avoid penalties and filing delays. 

As we approach the September 30, 2025 deadline for UAE Corporate Tax (CT) filings, businesses must act swiftly to ensure compliance. The UAE introduced its federal CT regime for financial years starting on or after June 1, 2023, with a standard 9 percent rate on taxable profits exceeding AED 375,000 (US$102,096.38), alongside carve-outs like free zone exemptions and small-business relief. 

However, compliance goes beyond filing. Companies must complete their FY 2024 audited accounts, make any necessary Transfer Pricing (TP) adjustments, and prepare comprehensive TP documentation—all before audits are finalized.  

The Federal Tax Authority’s new TP rules (Articles 34–36 and Ministerial Decision No. 97 of 2023) now demand that all related-party and connected-person transactions adhere to the arm’s length principle, with documentation thresholds triggered by transaction volumes and revenue ranges. 

Missing even one step—delaying the audit, omitting a TP benchmark study, or failing to adjust margins—can jeopardize the CT submission. The FTA may ask for proof within days, leaving no time to scramble. 

In this article we outline a clear, step-by-step timeline to help UAE entities avoid last-minute complications, safeguard against penalties, and meet the September filing deadline with confidence. 

Step 1: Audit of FY 2024 financial statements 

“Both mainland and free zone entities must ensure their FY 2024 audited financial statements are finalized in advance of the September 30, 2025 CT return deadline. Several free zones, such as DMCC and DIFC, have aligned their own audit submission deadlines with this federal CT filing requirement. Importantly, engaging an approved auditor early secures availability and avoids delays or non-compliance consequences (for instance, fines from DMCC start at AED 5,000 (US$1,361.28), license suspension, or blocked portal access). 

Moreover, audit reports must reflect any transfer pricing adjustments—such as arm’s‑length margin corrections—before audit sign-off, preventing post-audit amendments that could compromise the audit’s validity or attract scrutiny. 

Step 2: Assessment of related‑party transactions 

Under Articles 35–36 of the UAE Corporate Tax Law, any transaction involving Related Parties or Connected Persons triggers TP obligations. 

Identify and assess related-party and connected-person
Businesses must identify all related-party and connected-person transactions to determine if TP rules apply. Key thresholds include: 

• AED 40 million (US$10.89 million): Aggregate related-party transaction value triggering completion of the related-party transaction schedule. 

• AED 4 million (US$1.08 million): Threshold per transaction category (e.g., goods, services, interest) once the AED 40 million aggregate is exceeded. 

• AED 500,000 (US$136,128): Disclosure threshold for connected-person transactions. 

Definitions under Article  35: 

• Control relationships: ≥ 50 percent ownership or indirect control; shared control across entities; connections via trusts, partnerships, or permanent establishments;  

• Natural persons related up to the fourth degree (including by kinship, adoption, guardianship, marital affiliation); and 

• Group structures such as parent–subsidiary, sister companies under common control, and partnerships/trusts. 

Connected persons under Article  36 include: 

• Owners, directors, officers, and their related parties, as well as partners in unincorporated partnerships. 

Step 3: Transfer pricing policy and benchmarking 

Entities conducting related-party or connected-person transactions must: 

• Maintain a contemporaneous TP policy updated within the last three years, either entity-specific or as part of a group-wide framework covering UAE operations. 

• Conduct a benchmarking study demonstrating that intercompany transaction margins comply with the arm’s-length principle, using OECD-approved methods such as Comparable Uncontrolled Price (CUP), Transactional Net Margin Method (TNMM), Cost-Plus, or Profit Split. 

• Implement financial adjustments where actual margins fall outside the arm’s-length interquartile range, recorded before audit sign-off. Downward adjustments reducing taxable income require prior FTA approval. 

All documentation and evidence must be finalized prior to concluding FY 2024 audits, as post-audit revisions could invalidate audit results or lead to penalties. 

TP filing: Disclosure and documentation preparedness 

A mandatory TP framework—entity-specific or group-wide including UAE operations—must be current (not older than three years). A comprehensive benchmarking study must confirm arm’s-length margins using recognized OECD methods. 

It’s critical that all TP adjustments be made and documented prior to the audit report finalization. Retrospective changes post-audit are disallowed, and downward adjustments reducing taxable income require prior FTA approval   

All TP analyses and adjustments must be integrated into audited financials to avoid inconsistencies or regulatory challenges post-audit. 

CT filing: Disclosure and documentation preparedness 

The CT return requires detailed disclosure of related-party and connected-person transactions 

The CT return must be accompanied by a scripted TP Disclosure Form detailing reportable related-party transactions. Preparation of a Master File and Local File is mandatory if the group’s global revenue is AED 3.15 billion (US$857.6 million) or higher, or if the local entity’s revenue exceeds AED 200 million (US$54.45 million). 

Key takeaways 

Delaying preparation risks significant consequences, including audit delays, Corporate Tax non-compliance, and costly Transfer Pricing penalties. To avoid last-minute complications, start engaging qualified TP advisors and auditors immediately. Early action ensures your business meets the September 30, 2025 filing deadline confidently and avoids exposure to fines or regulatory scrutiny. 

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