UAE Tax Authority Issues Scope and Registration Guide for Multinational Top-Up Tax

The UAE Federal Tax Authority (FTA) has published an official Top-up Tax Guide on Scope and Registration to guide multinational enterprise (MNE) groups on their obligations under the country's Qualified Domestic Minimum Top-up Tax (QDMTT) legislation.

The regime forms part of the UAE's implementation of the OECD/G20 Two-Pillar Solution, specifically the Pillar Two Global Anti-Base Erosion (GloBE) rules designed to ensure large multinational groups pay an effective minimum tax rate of at least 15% across all jurisdictions where they operate. The tax applies to fiscal years beginning on or after 1 January 2025.

Under the rules, the top-up tax applies to UAE constituent entities belonging to MNE groups that record annual consolidated revenues of 750 million euros or more in the ultimate parent entity's financial statements in at least two of the four preceding fiscal years. Corporate groups that conduct business exclusively within the UAE are excluded from the scope of the legislation, regardless of revenue.

The guide outlines criteria for determining in-scope entities, covering the tax treatment of permanent establishments, joint ventures, flow-through entities, and hybrid entities. It also details registration procedures and deadlines through the EmaraTax platform, alongside requirements for filing the Pillar Two Information Return.