New Ministerial Decision No. 84 of 2025 issued by the Ministry of Finance
The United Arab Emirates (UAE) Ministry of Finance has recently issued Ministerial Decision No. 84 of 2025 replacing Ministerial Decision No 82 of 2023, aimed at enhancing transparency and ensuring higher financial reporting standards for businesses under the UAE's Corporate Tax Law.
The new guidelines will apply to tax periods commencing on or after 1 January 2025. Ministerial Decision No. 82 of 2023 will continue to be relevant for tax periods that began before this date.
Summary of the New Ministerial Decision
- New Requirements for Tax Groups
Under the revised regulations, Tax Groups are mandated to prepare audited special purpose aggregated financial statements specifically for Corporate Tax purposes. This requirement is designed to foster uniformity in financial reporting across tax groups without imposing additional administrative burdens on standalone entities. Entities within each Tax Group are exempt from preparing audited standalone financial statements. The Federal Tax Authority (FTA) will provide more detailed instructions on the framework for these aggregated financial statements shortly.
- Guidance for Free Zone Distributors
The updated decision provides that Qualifying Free Zone Persons involved in the distribution of goods or materials within or from a Designated Zone would need to comply with additional procedures to be specified by the FTA.
- Audit Threshold for Non-Residents
The new decision has also clarified that in case of non-residents only revenue derived through a Permanent Establishment or nexus in the UAE will be considered when determining whether a non-resident person meets the audit threshold of AED 50 million.
Conclusion
The recent Ministerial Decision reflects the UAE's dedication to transparency and the enhancement of financial reporting standards. By complying with these new regulations, businesses will align with UAE tax laws and support the nation’s objective of maintaining a transparent and business-friendly environment. Detailed instructions from the FTA will provide further assistance for the seamless implementation of these requirements.
It will be interesting to see how further guidance is articulated, considering that this decision applies to tax periods starting on or after 1 January 2025.
