UAE’s 15% Minimum Tax for Multinationals: Scope and Exemptions Explained
Amie Roberts • May 13, 2025
DMTT Scope & Exemptions Explained
Following our last article introducing the UAE’s 15% Domestic Minimum Top-Up Tax (DMTT)
for large multinational groups, this follow-up provides further information on which businesses fall within scope—and more importantly, which are exempt.
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What Is the DMTT?
To recap briefly, the Domestic Minimum Top-Up Tax is part of the UAE’s alignment with the OECD’s Pillar Two framework, ensuring that multinational groups pay a minimum effective tax rate of 15% in each jurisdiction where they operate. Rather than replacing existing UAE corporate tax, the DMTT works alongside it—applying only in cases where the effective rate falls below the global threshold.
What Has Been Clarified?
Exclusions for Smaller Entities
The DMTT only applies to MNE groups with global revenue exceeding €750 million. Standalone companies and smaller business groups remain unaffected.
No Retroactive Application
The tax will only apply from the 2025 financial year onwards, and assessments will not cover previous periods.
Treatment of Free Zone Income
While income from qualifying free zone activities may continue to enjoy a 0% rate, any income outside the scope of free zone benefits could still be subject to the DMTT.
Interaction With Existing UAE Corporate Tax
The standard 9% corporate tax introduced in June 2023 will continue to apply. The DMTT is designed to work alongside, not replace, the existing tax framework.
Implications for Business Planning
- Global Coordination: Multinational finance teams must now coordinate with UAE subsidiaries to ensure group-level compliance.
- Data Readiness: Companies need to gather and structure financial data across jurisdictions to meet reporting standards.
- Technology Upgrades: Tax reporting systems may need to be upgraded to handle the complexity of DMTT calculations and filings.
Practical Steps for UAE Businesses in Scope
For large international groups operating in the UAE, the DMTT introduces a new layer of tax planning and compliance obligations. Here’s what to focus on in the months ahead:
- Evaluate Group Revenue: Confirm whether your group exceeds the €750 million global threshold.
- Map UAE Operations: Identify all UAE-based entities and review their tax profiles, Free Zone status, and qualifying activities.
- Calculate Effective Tax Rate: Assess if your UAE operations will fall below the 15% threshold in 2025.
- Prepare for Reporting: Begin updating systems and processes to meet upcoming reporting and compliance requirements aligned with the OECD's global standards.
Should You Be Concerned if You’re Not an MNE?
For most UAE-based SMEs and family-owned firms, this tax will not apply.
However, if you are advising large groups or anticipate future growth to that level, it is worth understanding the new rules.
Conclusion
The additional guidance from the Ministry of Finance provides welcome clarity.
While many UAE-based businesses are outside the scope, those within should use the remainder of 2024 to prepare.
Our team can help you assess how the new rules apply and support your planning.
Get in touch today if your business or your clients operate as part of a global group.
Navigating the UAE Employment Visa Process in 2026 Relocating to the United Arab Emirates for employment offers significant professional and financial opportunities. However, the UAE employment visa process is structured, compliance-driven and time sensitive. Understanding each stage in advance avoids unnecessary delays and protects both employer and employee from regulatory issues. Below is a comprehensive, easy-to-follow guide to the UAE employment visa process as it stands in 2026. Step 1: Securing a Confirmed Job Offer The UAE employment visa process begins with a formal job offer from a UAE-licensed entity. Only an employer registered with the relevant mainland authority or free zone authority can sponsor an employee. The employer becomes the visa sponsor and assumes legal responsibility for: Applying for the work permit Processing the residence visa Ensuring compliance with UAE labour law Covering government application fees (in most cases) Employees cannot independently apply for a standard employment visa without sponsorship. Step 2: Work Permit Application (Entry Permit Approval) Once the employment contract is signed, the employer applies for a work permit (also known as a labour approval) through the Ministry of Human Resources and Emiratisation (MOHRE) or the relevant free zone authority. Documents typically required include: Passport copy (valid for at least six months) Passport-size photographs Signed employment contract Attested educational certificates (if required for the role) If the employee is outside the UAE, an entry permit is issued, allowing them to enter the country legally for employment purposes. If the employee is already inside the UAE on a visit visa, status adjustment procedures apply. Step 3: Entry to the UAE (If Applying From Abroad) For applicants outside the UAE, the entry permit allows legal entry into the country. Once inside the UAE, the individual must complete the residency formalities within the validity period of the entry permit (usually 60 days). Timing is critical at this stage. Failure to complete the process within the permitted window may result in fines. Step 4: Medical Fitness Test All employment visa applicants must undergo a mandatory medical examination at an approved UAE medical centre. The test typically screens for: HIV Tuberculosis Hepatitis (in certain categories) The medical fitness certificate is a mandatory component of the residence visa application. Processing time: usually 24–72 hours depending on service speed selected. Step 5: Emirates ID Biometrics The applicant must apply for an Emirates ID, which serves as the UAE’s official identification card. This process includes: Biometric data capture (fingerprints and photograph) Identity verification The Emirates ID is linked directly to the residence visa and is essential for: Opening bank accounts Renting property Obtaining a driving licence Accessing utilities and telecom services Step 6: Residence Visa Stamping Following medical clearance and Emirates ID application, the residence visa is issued and stamped electronically against the passport record. Employment residence visas are typically valid for: 2 years (mainland companies) 2–3 years (depending on free zone authority) Once issued, the employee is legally resident in the UAE and may sponsor eligible dependants (subject to salary thresholds). Key Considerations in 2026 1. Free Zone vs Mainland Sponsorship Visa procedures differ slightly between mainland entities and free zone authorities. Free zones operate under independent regulatory frameworks, although federal immigration approval remains central. The choice between mainland and free zone employment has broader implications, including: Corporate structuring Tax residency status Social security considerations Family sponsorship options These should be assessed before finalising relocation plans. 2. Employment Visa vs Other UAE Visa Categories The UAE also offers: Green Visas (for skilled professionals and freelancers) Golden Visas (long-term residence for investors and high earners) Investor/Partner Visas For entrepreneurs and senior executives, an employment visa is not always the optimal route. Strategic structuring may offer longer validity and greater flexibility. 3. Tax Residency Implications The UAE does not levy personal income tax. However, relocating professionals must consider: Exit tax implications in their home country UK Statutory Residence Test (for British nationals) Split-year treatment Ongoing ties and centre-of-vital-interests rules Corporate tax exposure for business owners Inadequate pre-departure planning can result in unintended dual tax exposure. 4. Corporate Tax and Employment Structuring With the introduction of UAE Corporate Tax, business owners relocating to the UAE must assess: Whether they will remain directors of overseas entities Permanent establishment risks Substance requirements Intercompany arrangements Employment structuring must align with the broader corporate and tax strategy. Why a Structured Relocation Approach Matters Many professionals treat the employment visa as a simple administrative formality. In practice, it forms part of a much larger relocation framework that includes: Tax residency planning Wealth structuring Asset protection Banking arrangements Property acquisition Family visa coordination A piecemeal approach often creates long-term complications. How Mosaic Chambers Group Supports Your Move to the UAE At Mosaic Chambers Group, we provide integrated advisory services for internationally mobile individuals and entrepreneurs. We coordinate: Pre-departure UK tax planning UAE tax structuring advice Cross-border compliance Local regulatory compliance We work alongside trusted UAE-based partners to manage: Visa processing Company formation Corporate structuring analysis Family sponsorship applications Wealth protection strategies Relocating to the UAE should be strategic, compliant and financially efficient - not reactive. Speak to Our Advisory Team If you are considering accepting a UAE job offer or relocating your business operations to the Emirates, we recommend obtaining professional tax and structuring advice before finalising your move. Early planning protects your position, reduces risk and ensures your move to the UAE is commercially sound and fully compliant. Get in touch with our team today to begin your relocation strategy with clarity and confidence.
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