Transfer Pricing & Related Party Compliance

Under UAE Corporate Tax, transactions and arrangements between related parties and connected persons must meet the arm’s length principle they must be priced as if the parties were independent. This affects intra group sales, services, financing, royalties, and payments to owners and their relatives.

Businesses must be able to show that their related party dealings are at arm’s length, and larger businesses must maintain formal documentation. Falling short can lead to FTA adjustments, additional tax, and penalties. We help you set, document, and defend compliant transfer pricing positions.

When Documentation Is Required

All related party transactions must follow the arm’s length principle, and a transfer pricing disclosure form is filed with the Corporate Tax return where the relevant thresholds are met. A master file and local file are generally required where the business is part of a multinational group with consolidated revenue of AED 3.15 billion or more, or where the business’s own revenue is AED 200 million or more.

What’s Involved

Transaction mapping we identify your related parties, connected persons, and the controlled transactions between them.

Benchmarking we test pricing against comparable independent transactions to support an arm’s length position.

Disclosure form we prepare the transfer pricing disclosure filed alongside your Corporate Tax return.

Master file and local file we prepare the formal documentation where the thresholds apply.

Advisory we advise on intra group financing, management charges, and restructuring before transactions are put in place.

Frequently Asked Questions

Broadly, parties connected through ownership or control such as group companies and connected persons such as owners, directors, and their relatives. The law sets out the specific tests.

No. The arm’s length principle applies to all, but formal master and local files are required only where the revenue thresholds are met.

The FTA can adjust the pricing for tax purposes, which may increase taxable income and lead to additional tax and penalties.

No. The arm's length principle applies to both domestic and cross border transactions between related parties and connected persons.

Connected persons include owners of the business, directors and officers, and their relatives, in addition to entities under common ownership or control.

The disclosure form summarizes related party and connected person transactions and is filed alongside the Corporate Tax return where the relevant thresholds are met.

It compares the pricing or margins of related party transactions against comparable transactions between independent parties to test whether pricing is at arm's length.

Intra group sales, services, financing arrangements, royalties, management charges, and payments to owners and relatives are all reviewed.

The taxable person is responsible for preparing and retaining master file, local file, and disclosure documentation where thresholds are met, though this work is often outsourced to advisors.

It should be retained in line with the general Corporate Tax record keeping period so it is available if the FTA requests it.

Yes. Intra group restructurings, financing changes, and revised management charge arrangements should be reviewed to confirm they remain consistent with the arm's length principle.

Voluntary documentation demonstrates that related party pricing is defensible, which can reduce the risk and impact of an FTA enquiry.

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Transfer Pricing & Related Party Compliance

When Documentation Is Required

What’s Involved

Key Benefits

Why Legacy Partners

Frequently Asked Questions

Strategic Partners

Insights On Tax & Audit

FTA Decision No. 7 of 2026: What Happens to Seized and Abandoned Goods in the UAE

UAE Pillar Two Registration Is Now Open : What Multinational Groups Must Do Next

OECD Proposes Revisions to Transfer Pricing Guidelines for Intra Group Services

Ready to establish your legacy?

Transfer Pricing & Related Party Compliance

When Documentation Is Required

What’s Involved

Key Benefits

Why Legacy Partners

Frequently Asked Questions

Who counts as a related party?

Does every business need a master file and local file?

What happens if transactions are not at arm’s length?

Does transfer pricing apply only to cross border transactions?

What counts as a "connected person"?

What is included in a transfer pricing disclosure form?

What does a benchmarking study involve?

What kinds of transactions are typically reviewed for transfer pricing?

Who is responsible for preparing transfer pricing documentation?

How long should transfer pricing documentation be kept?

Does restructuring within a group need transfer pricing review?

What is the benefit of preparing transfer pricing documentation even below the mandatory threshold?

Strategic Partners

Insights On Tax & Audit

FTA Decision No. 7 of 2026: What Happens to Seized and Abandoned Goods in the UAE

UAE Pillar Two Registration Is Now Open : What Multinational Groups Must Do Next

OECD Proposes Revisions to Transfer Pricing Guidelines for Intra Group Services

Ready to establish your legacy?