UAE Free Zone Transfer Pricing Rules Reference 2026
UAE corporate tax introduced transfer pricing requirements for related party transactions. Here is the 2026 reference guide.
In this guide:
What Is Transfer Pricing?
- Transfer pricing: The prices charged between related parties (affiliated companies, group entities) in transactions
- UAE requirement: Transactions between UAE company and related parties must be at arms-length (market) prices
- Regulation: UAE CT Law; OECD Transfer Pricing Guidelines apply
Who Does Transfer Pricing Apply To?
- UAE companies with related party transactions: If you charge a foreign related company for services, or receive charges from a related foreign company
- Thresholds: Disclosure required in CT return for all related party transactions; documentation required above specific thresholds
- Small companies (SBR): If electing Small Business Relief, simplified transfer pricing approach may apply
Key Transfer Pricing Methods
- Comparable Uncontrolled Price (CUP): Compare to similar third-party transactions
- Cost Plus: Cost of service + appropriate markup
- Profit Split: Split combined profits based on contributions
- Transactional Net Margin Method (TNMM): Compare net margins to comparable companies
Documentation Requirements
- Master file: Group-level transfer pricing documentation (required for MNE groups)
- Local file: UAE-entity level transfer pricing documentation
- Country-by-Country Reporting (CbCR): For MNE groups with AED 3.15 billion+ revenue
- Most small UAE free zone companies: Simplified disclosure in CT return; full documentation may not be required unless above thresholds