The UAE introduced new reporting requirements for multinational companies operating in the country, adding another layer to its implementation of the global minimum tax framework. The Ministry of Finance issued Ministerial Decision No. 133 of 2026, setting out which UAE-based entities must submit a Pillar Two Information Return to the Federal Tax Authority (FTA). The rules apply to financial years beginning on or after January 1, 2025.
The move is part of the UAE's implementation of the OECD/G20 Pillar Two framework, which is designed to ensure large multinational enterprise groups face a minimum effective tax rate across the countries where they operate.
The new decision identifies three broad categories of entities that must file the Pillar Two Information Return. These include UAE-based constituent entities of multinational groups, excluding investment entities. The requirement also covers joint ventures and their subsidiaries located in the UAE.
A third category covers certain stateless constituent entities that are reverse hybrid entities established under UAE law. The return can either be submitted directly by the relevant UAE entity or by a Designated Local Entity acting on its behalf.
This clarification is particularly important for multinational groups with complicated corporate structures, as several entities within the same group may have different reporting responsibilities.
The new reporting requirement is linked to the UAE's Domestic Minimum Top-up Tax (DMTT). The regime applies to multinational enterprise groups with consolidated global revenue of at least AED 3.2 billion in at least two of the four financial years preceding the relevant tax year.
The global minimum tax framework aims to establish a 15% minimum effective tax rate for large multinational groups. The UAE's domestic rules form part of the broader international effort to address tax challenges created by increasingly globalised and digital business operations.
The UAE introduced its federal corporate tax regime for financial years beginning on or after June 1, 2023, with a standard rate of 9%.
For multinational companies, the latest decision provides greater clarity over who is responsible for filing information under the Pillar Two system. The requirement also means affected businesses will need to review their corporate structures, financial information and tax reporting processes to ensure they can meet the new obligations.
The Ministry of Finance said the decision supports greater international tax transparency and certainty for multinational enterprises operating in the UAE. The UAE has also received recognition under the Pillar Two framework for certain safe-harbour arrangements, which can reduce the amount of additional tax calculation and reporting required in some circumstances.
| Requirement | Details |
|---|---|
| Decision | Ministerial Decision No. 133 of 2026 |
| Framework | Pillar Two / GloBE |
| Authority | UAE Federal Tax Authority |
| Effective period | Financial years from January 1, 2025 |
| Revenue threshold | AED 3.2 billion for qualifying MNE groups |
| Minimum tax framework | 15% |
| Covered entities | UAE constituent entities, JVs and certain stateless entities |
The latest move shows that the UAE is continuing to strengthen its corporate tax and international reporting framework while maintaining its position as a major hub for multinational businesses. For companies operating in the country, understanding the new Pillar Two reporting requirements will become an increasingly important part of tax compliance.