UAE wins OECD approval for its corporate top-up tax

This cuts compliance burdens for multinational companies, aids global business hub status

Last updated: August 25, 2025 | 15:35

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UAE wins OECD approval for its corporate top-up tax

Dubai: The UAE Ministry of Finance has announced that the Organisation for Economic Co-operation and Development (OECD) has granted the country’s Domestic Minimum Top-up Tax (DMTT) “Transitional Qualified Status”, listing it on the OECD’s official Central Record of Legislation.

This recognition affirms the UAE’s commitment to aligning with international tax standards and the Inclusive Framework on Base Erosion and Profit Shifting (BEPS).

What this means for UAE businesses

No double top-up tax: Multinational enterprises (MNEs) operating in the UAE will not need to calculate or pay additional top-up tax in other jurisdictions.
OECD Safe Harbour benefit: The UAE’s DMTT qualifies under the OECD’s Pillar Two Safe Harbour, easing administrative requirements and lowering compliance costs.
Reduced audit risks: Other jurisdictions will recognise the UAE’s tax obligations, helping avoid costly cross-border disputes and complex audits.

The Ministry highlighted that the OECD’s recognition “cements the UAE’s position as a leading international business hub” and provides clarity, transparency, and certainty for multinational groups operating in the country.

By qualifying under the OECD framework, the UAE ensures that top-up tax obligations are applied locally, supporting both investor confidence and sustainable economic growth.

Why it matters

For investors and business leaders, the announcement means:

Greater tax certainty in the UAE’s evolving corporate tax regime.
Lower compliance costs when structuring global operations.
Reinforcement of the UAE’s reputation as a transparent, globally aligned business environment.

Justin VargheseYour Money Editor

Justin is a personal finance author and seasoned business journalist with over a decade of experience. He makes it his mission to break down complex financial topics and make them clear, relatable, and relevant—helping everyday readers navigate today’s economy with confidence. Before returning to his Middle Eastern roots, where he was born and raised, Justin worked as a Business Correspondent at Reuters, reporting on equities and economic trends across both the Middle East and Asia-Pacific regions.