Transfer Pricing Services in the UAE

Transfer pricing is one of the areas of UAE Corporate Tax that catches businesses out, because it applies even to dealings between companies in the same group and to payments to owners and directors. The rules require these transactions to be priced at arm's length, and they come with disclosure and documentation obligations. Safeway helps groups, family businesses and free zone companies apply the arm's length principle correctly and prepare the documentation the FTA expects. We are an FTA-approved tax agent in Ajman working with clients across all emirates.

What transfer pricing means under UAE Corporate Tax

Transfer pricing rules require transactions between related parties, and payments to connected persons, to reflect the price independent parties would have agreed — the arm's length principle. The UAE rules follow the OECD approach, and they apply to cross-border transactions and to transactions wholly within the UAE. Getting the pricing wrong can shift profit, understate tax, and expose the business to adjustments and penalties.

Related parties and connected persons

• Related parties — entities and individuals linked by ownership (generally 50% or more), common control, or close family relationships up to the fourth degree.
• Connected persons — the owners, directors and officers of the business and their related parties. Payments or benefits to connected persons are only deductible if they are at arm's length and correspond to the market value of the service provided.

The arm's length principle and methods

To test whether a price is at arm's length, one of the recognised OECD methods is applied:

• Comparable Uncontrolled Price (CUP)
• Resale Price Method
• Cost Plus Method
• Transactional Net Margin Method (TNMM)
• Transactional Profit Split Method

The right method depends on the transaction and the data available. We select and document the method, and benchmark it against comparable data.

Disclosure and documentation requirements

• Transfer pricing disclosure form — may be required alongside the Corporate Tax return where related party and connected person transactions exceed set thresholds.
• Master file and local file — required where the taxable person's revenue is at least AED 200 million in the tax period, or it is part of a multinational group with consolidated group revenue of at least AED 3.15 billion.
• Documentation must be kept and provided to the FTA, generally within 30 days of a request.

Why it matters for free zone companies

For a Qualifying Free Zone Person, complying with the arm's length principle and keeping transfer pricing documentation is one of the conditions for keeping the 0% rate. A free zone company that ignores transfer pricing risks more than an adjustment — it risks losing its qualifying status altogether.

Why businesses choose Safeway

• Arm's length reviews of intercompany and connected-person transactions
• Preparation of disclosure forms, master file and local file
• Practical policies for family businesses and groups
• Joined up with your Corporate Tax return, so the positions are consistent

Contact us for a transfer pricing review before your next Corporate Tax filing.

Frequently asked questions

What is transfer pricing under UAE Corporate Tax?

Rules requiring transactions between related parties and payments to connected persons to be priced at arm's length, following the OECD principle. They apply to UAE-only transactions too.

When is documentation required?

A disclosure form where transactions exceed set thresholds; a master file and local file where revenue is at least AED 200 million, or the business is in a group with consolidated revenue of at least AED 3.15 billion.

Does it apply to free zone companies?

Yes — and meeting transfer pricing requirements is a condition for a Qualifying Free Zone Person to keep the 0% rate.

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