The UAE Federal Tax Authority (FTA) released a revised Corporate Tax Guide on Tax Groups, known as CTGTGR1, on 11 November 2026. The updated guide replaces the January 2024 version and provides important clarification on how businesses should manage Corporate Tax when operating through parent companies and subsidiaries.
The update is particularly relevant to companies that already operate as UAE Corporate Tax Groups and businesses considering forming or joining one. It covers financial reporting, foreign tax credits, tax losses, partnership eligibility and investment property depreciation. Businesses should review these areas to ensure their tax calculations and reporting processes follow the latest guidance.
New Audited Financial Reporting Requirements
One of the key areas addressed in the revised guide is the requirement for audited Aggregated Financial Statements. Under Ministerial Decision No. 84 of 2025, every Corporate Tax Group must prepare these statements using the required special-purpose framework, regardless of its revenue size.
The process involves combining the standalone financial statements of group members and removing specified transactions between them. The statements must be audited and submitted to the FTA within nine months after the end of the relevant tax period.
Businesses should not assume that their ordinary consolidated financial statements will meet this requirement. They need accurate accounting records, proper financial reporting and suitable audit preparation to meet the FTA’s requirements.
Foreign Tax Credit Calculations Clarified
The revised CTGTGR1 guide also explains how Corporate Tax Groups should calculate Foreign Tax Credits (FTC). For tax periods starting on or after 1 January 2025, the calculation is based on the aggregated results of the entire Tax Group rather than the separate results of each member.
This matters to businesses that earn income outside the UAE and pay tax in another country. Their finance teams should review existing calculations and apply the updated group-level approach when preparing their tax returns.
Pre-Grouping Tax Losses and Partnership Rules
The guide also clarifies how businesses can use pre-grouping tax losses. These are losses a company incurred before joining a Corporate Tax Group. They can only be used against income attributable to the member that brought them into the group. Their use is also subject to the 75% taxable income limit.
Companies should keep clear records of historic losses and calculate the relevant member’s attributable income. Incorrect calculations or failure to use eligible losses to the required extent can lead to forfeiture under the applicable rules.
The FTA has also clarified the position of unincorporated partnerships. They cannot automatically join a Tax Group. However, a partnership approved as a Taxable Person in its own right may qualify if it meets the other required conditions.
Investment Property and Tax Depreciation
Another area covered by the revised guide is tax depreciation for qualifying investment properties held at fair value. It explains how the rules apply when a company joins or leaves a Tax Group or transfers property within the group.
Property-holding businesses should maintain accurate records of property costs, tax depreciation and written-down values. Good bookkeeping services and reliable financial records can help businesses track these figures and support their tax calculations.
What Should UAE Businesses Do Now?
Companies should review their group structures, financial statements, historic tax losses and foreign tax credit calculations. They should also check their audit arrangements and ensure that their accounting processes meet the updated reporting requirements.
Ignoring these requirements can result in incorrect tax calculations, missed reporting obligations or the loss of available tax benefits. Businesses should seek professional guidance before making changes to their group structure or tax reporting approach.
Dubai Business and Tax Advisors (DBTA) supports UAE companies through UAE Corporate Tax advisory, accounting services in Dubai, audit and assurance, financial reporting, and budgeting and forecasting. Its ACCA-qualified team can help businesses review financial records, understand their tax responsibilities and improve their compliance processes.
The revised CTGTGR1 guide is an important update for UAE businesses operating through multiple entities. Reviewing the guidance now can help parent companies and subsidiaries prepare their financial information, manage tax obligations and reduce avoidable compliance risks.
