Advisory · Arm’s-length pricing
Transfer pricing.
Documented before it’s asked.
Related-party pricing documented to stand up to FTA scrutiny — a transaction register, method selection and benchmarking, the disclosure schedule filed with your Corporate Tax return where thresholds are crossed, and Master and Local File where required. The FTA allows 30 days to produce it, so the file is built and partner-reviewed before it is asked for.
UAE transfer pricing documentation — the short answer
UAE transfer pricing applies the arm’s-length principle and the OECD Guidelines to related-party and connected-person transactions. A disclosure form is filed with the Corporate Tax return where thresholds are exceeded, and a Master File and Local File must be maintained where the business is part of a multinational group with consolidated group revenue of AED 3.15 billion or more, or its own revenue is AED 200 million or more. The FTA can require the documentation within 30 days of a request.
What the engagement covers
Transfer Pricing, end to end.
Related-party mapping
Every related-party and connected-person flow identified, quantified and tied back to the ledger.
Benchmarking & method choice
The right method selected — CUP, resale price, cost plus, TNMM or profit split — and benchmarked to evidence.
TP disclosure & Local File
The disclosure schedule filed with your CT return where thresholds are crossed, and Master/Local File where required.
Free-zone & FTA defence
QFZP arm’s-length and substance tested, and a partner-reviewed file ready for the FTA’s 30-day request.
The engagement, end to end
How we run it.
01
Map
Identify every related-party and connected-person transaction and quantify it from the ledger.
02
Characterise
Set out the functions, assets and risks on each side of the transaction, in writing.
03
Benchmark
Select the method, run the comparables search and set the arm’s-length range.
04
Partner review
A partner challenges the method, the comparables and the residual risk before anything is filed.
05
File & hold
File the disclosure with the CT return where thresholds are crossed; hold the file for the FTA’s 30-day window.
FAQ
Transfer Pricing, answered.
Where the taxable person is part of a multinational group with consolidated group revenue of AED 3.15 billion or more in the period, or where its own revenue is AED 200 million or more. Below those thresholds there is no Master File or Local File duty — but a transfer pricing disclosure schedule is still filed with the Corporate Tax return where the FTA’s own thresholds are crossed: aggregate related-party transactions above AED 40 million (then per-category above AED 4 million), or payments and benefits to a single connected person and its related parties above AED 500,000. A Local File is required in both cases; a Master File where the group has operations outside the UAE. Both are produced to the FTA within 30 days of a request, so we build them before they are asked for.
Five recognised methods: comparable uncontrolled price (CUP), resale price, cost plus, the transactional net margin method (TNMM) and profit split. Where none of them fits the facts, another method can be applied if it produces an arm’s-length result — but the reasoning has to be documented. Method choice carries the analysis, so we set out why the chosen method beats the alternatives, in a memo a partner has signed off.
Yes. Individual owners, directors and officers — and their related parties — are connected persons (a corporate shareholder is a related party instead, tested under the same arm’s-length principle), and payments to them — salary, management fees, rent, interest on shareholder loans — are deductible only to the extent they match market value and are incurred wholly and exclusively for the business. That makes the owner’s remuneration a transfer pricing question, not a payroll one. Benchmarking settles the market-value test; the business-purpose evidence settles the second, and we document both with the Corporate Tax file — so the deduction rests on analysis, not assertion, when the FTA asks.
If it wants to keep the 0% rate, yes. Arm’s-length pricing and transfer pricing compliance are two of the five cumulative QFZP conditions — alongside qualifying income, adequate substance, the de-minimis limit (non-qualifying revenue not exceeding the lower of 5% of total revenue or AED 5 million) and audited financial statements. Fail any condition at any point in a period and QFZP status is lost from the start of that period and for the four periods after it — five tax periods on the ordinary 9% regime above AED 375,000, not one. We test the transfer pricing conditions each year and document the conclusion; the others are tested with your Corporate Tax file.