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UAE - FTA Decision on Audited Special Purpose Financial Statements Requirements for Tax Groups

11 August 2025 – On 16 July 2025, the Federal Tax Authority (FTA) of the United Arab Emirates (UAE) issued FTA Decision No. 7 of 2025 (Decision), published on 8 August 2025. This Decision is on determination of the requirements for preparing and maintaining Audited Special Purpose Financial Statements (SPFSs) for a tax Group for the purposes of Federal Decree-Law No. 47 of 2022.

This decision is effective for tax periods starting on or after 1 January 2025. It builds upon Ministerial Decision (MD) No. 84 of 2025, issued by the Ministry of Finance (MoF) in March 2025, outlining the conditions under which taxpayers must prepare and maintain audited financial statements (FSs) for UAE Corporate Tax (CT) Law purposes. MD No. 84 also repeals and replaces MD No. 82 of 2023 for financial years commencing on or after 1 January 2025.

In this alert, we have summarized the key points and takeaways brought in through the new published Decision.

Article 1 – Definitions
Defines "Aggregated FSs" as FSs prepared on the basis of aggregation of the standalone FSs of the Parent Company and each Subsidiary that is a member of the Tax Group in accordance with the framework specified in Article 3 of this Decision. 

Article 2 – Requirements for Preparing Audited Special Purpose Financial Statements

  • Tax Groups must prepare Special Purpose Aggregated FSs in accordance with Article 3 of this Decision.
  • These statements must be audited according to International Standards on Auditing (ISAs).
  • Audited Aggregated FSs must be submitted to the FTA within nine months of the end of the Tax Period.

Article 3 – Framework for Aggregated Financial Statements

  • FSs of members within the Tax Group must be aggregated based on the standalone FSs of the members of the Tax Group, ensuring intra-group transactions are eliminated. However, transactions and FSs involving entities outside the Tax Group should neither be aggregated nor eliminated.
  • Aggregated FSs must comply with IFRS or IFRS for SMEs and should maintain uniform accounting policies across entities.
  • Investments in subsidiaries, joint ventures, and associates not within the tax group must be carried at cost less impairment.
  • The Decision also contains specific provisions related to business combinations and investments, emphasizing no eliminations between certain accounts, as follows:
  • Business Combinations:
    • Standalone FSs of an acquiring entity in a tax group should exclude IFRS 3 and IFRS 10 implications.
    • Adjustments for goodwill, bargain purchase, or fair value in IFRS consolidated statements must not appear in the Aggregated FSs, except in cases where above adjustments are part of standalone FSs of the acquiring entity (e.g., business purchase scenario).
  • Aggregation Method:
    • The pre-tax profit or loss of all members will be taken into account.
    • FS line items, including investments and equity, should be aggregated line-by-line without eliminations for intra-group balances.
    • Impairments in the parent’s or subsidiaries' direct investments within the tax group must not be eliminated.
  • The Aggregated FS must be presented in the United Arab Emirates Dirham as a reporting currency. 

Article 4 – Statements and Disclosure Requirements

  • Aggregated FSs should include:
    • Statement of financial position.
    • Statement of profit or loss.
    • Statement of other comprehensive income.
    • Statement of changes in equity.
  • Must disclose framework, aggregation basis, and material accounting policies, estimates, judgments, explanatory information, and notes. 

Article 5 – FSs of Members Leaving the Tax Group

Outlines how assets and liabilities should be handled when a member leaves the Tax Group, based on values recorded by the Tax Group.

Article 6 – Implementation

This Decision is effective for Tax Periods starting on or after 1 January 2025.

It is important to note that all Tax Groups are required to prepare these Audited Special Purpose Aggregated Financial Statements, regardless of any revenue threshold.

Key Takeaways

This Decision provides essential guidance on the format and primary adjustments needed for preparing and maintaining Aggregated FSs for tax grouping purposes. Relevant to note that statement of cash flows is not listed in the statements to be presented in a set of aggregated financial statements.

Taxable entities (corporate tax groups) in the UAE are advised to assess their obligations regarding the preparation and audit of the aggregated FSs to ensure compliance with the CT Law. It may be prudent for these entities to consider aligning their 2024 financials with this Decision.

Notice

The above is only a brief summary of the current update, is valid at the time of circulation and is based only on information currently available in the public domain which is subject to change. This alert has been written in general terms and does not constitute any form of advice or recommendation by Deloitte and therefore cannot be relied on to cover specific situations; application of the principles set out will depend upon the particular circumstances involved and we highly recommend that you obtain professional advice before acting or refraining from acting on any of the contents of this publication. Deloitte accepts no duty of care or liability for any loss occasioned to any person acting or refraining from action as a result of any material in this publication.

Deloitte and Touche Middle East would be pleased to advise readers on how to apply the principles set out in this publication to their specific circumstances.

Contacts

We have a dedicated Business Tax team based in the UAE who have in-depth experience and can support you throughout your readiness journey. Please get in touch with one of our tax experts listed on the following page.

You can also contact us and submit all your queries on this email cituae@deloitte.com.

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