Under UAE corporate tax, you must prepare and keep audited financial statements if your business earns revenue of more than AED 50 million in a tax period, or if it is a Qualifying Free Zone Person. Tax groups must keep audited special purpose financial statements. These rules come from Ministerial Decision No. 84 of 2025 and apply to tax periods starting on or after 1 January 2025.
Source: Ministerial Decision No. 84 of 2025 (Ministry of Finance)
Who Needs Audited Financial Statements
| Business | Audited accounts needed? |
|---|---|
| Taxable person (not a tax group) with revenue over AED 50 million | Yes |
| Qualifying Free Zone Person | Yes, whatever its revenue |
| Tax group | Yes, audited special purpose financial statements |
| Taxable person with revenue of AED 50 million or less (not a QFZP) | Not required by this decision |
For non-resident persons, only revenue from a permanent establishment or nexus in the UAE counts towards the AED 50 million.
Source: Ministerial Decision No. 84 of 2025
Free Zone Companies
A Qualifying Free Zone Person must keep audited financial statements to benefit from the 0% rate on qualifying income, even if its revenue is small. See our free zone corporate tax guide.
What Changed in 2025
Ministerial Decision No. 84 of 2025 replaced Ministerial Decision No. 82 of 2023. The old decision still applies to tax periods that started before 1 January 2025. The new one adds the rule for tax groups and the non-resident revenue rule.
Source: Ministerial Decision No. 84 of 2025
Which Accounting Standards to Use
| Revenue in the tax period | Accepted standard |
|---|---|
| Over AED 50 million | IFRS |
| AED 50 million or less | IFRS, or IFRS for SMEs |
| AED 3 million or less | Cash basis of accounting is allowed |
These rules come from Ministerial Decision No. 114 of 2023. The FTA can also allow the cash basis in exceptional circumstances, on application.
Source: FTA: Accounting Standards and Corporate Tax guide
Why It Matters
- Your corporate tax return starts from your accounting profit, so your accounts must be accurate
- A Qualifying Free Zone Person without audited accounts risks losing the 0% rate
- The FTA can ask for your financial statements during an audit
Good bookkeeping makes the audit faster and cheaper. See our bookkeeping requirements guide and corporate tax return guide.
Steps to Get Audit-Ready
- Check your revenue for the tax period and whether you are a Qualifying Free Zone Person.
- Keep your books under IFRS (or IFRS for SMEs if eligible).
- Reconcile bank accounts, invoices and VAT records every month.
- Appoint an auditor in good time before your return deadline.
- Use the audited figures for your corporate tax return.
Frequently Asked Questions
Who needs audited financial statements for UAE corporate tax?
Taxable persons with revenue over AED 50 million, Qualifying Free Zone Persons and tax groups (audited special purpose financial statements).
Do free zone companies need audited accounts?
A Qualifying Free Zone Person does, whatever its revenue.
Can a small business use the cash basis of accounting?
Yes, if its revenue is AED 3 million or less in the tax period.
Can I use IFRS for SMEs?
Yes, if your revenue doesn't exceed AED 50 million in the tax period.
When does Ministerial Decision No. 84 of 2025 apply from?
Tax periods starting on or after 1 January 2025.
Note: This article provides general information only and is not tax advice. Confirm the current requirements with the Federal Tax Authority or a qualified tax professional.