UAE Transfer Pricing Disclosure Form: Best Practices & Pitfalls to Avoid

Your Step-by-Step Guide to Filing the TP Disclosure Form in Right Way

The introduction of Corporate Tax in the UAE has made Transfer Pricing (TP) compliance a key area of focus—especially for businesses dealing with related parties and connected persons. Among the new obligations is the Transfer Pricing Disclosure Form, which must be submitted with your Corporate Tax return.

If you’re a finance / tax leader or business owner in the UAE, here’s your practical guide to filing the TP Disclosure Form accurately—without stress or surprises.

Why Does the TP Disclosure Form Matter?

The Transfer Pricing Disclosure Form is not just another form—it’s the Federal Tax Authority’s (FTA) way of checking if your intercompany transactions are priced at arm’s length. Failing to file it correctly—or skipping it altogether—can lead to audits, penalties, or disallowed deductions.

And while the thresholds seem clear (AED 40 million for related-party transactions, AED 500,000 for connected-person payments), the real complexity lies in identifying relationships and ensuring proper documentation.

Best Practices for Smooth TP Disclosure

To help you avoid compliance issues and prepare a solid TP submission, here are the top best practices followed by experienced finance teams:

1. Maintain a Central Intercompany Register

Create a centralized log of all related-party transactions throughout the year. This register should capture the parties involved, nature of transactions, and values. It’s the easiest way to ensure no relationship or transaction is overlooked.

2. Benchmark in Advance

TP is all about showing that your prices are fair. Do your benchmarking studies well before year-end so you can make adjustments in time. Whether it’s management fees, loans, or royalties—have market-based comparisons ready.

3. Don’t Rely on Financial Reporting Standards Alone

UAE TP rules define related parties and connected persons differently from financial accounting standard. A director’s relative or a 50% indirect shareholder might trigger disclosure—even if your financial statements don’t mention them. Always check against UAE-specific definitions.

4. Document Thoroughly

Even if you don’t submit the full Local File or Master File, you must keep all documents ready. This includes:

Intercompany agreements
Benchmarking studies
IP or asset valuations
Financials
Invoices and contracts

The FTA expects you to tick off a document checklist in the TP form—so have your paperwork ready before filing.

5. Avoid Simple Oversights

Common mistakes include:

Forgetting small intra-group loans
Mislabeling payments
Mixing business and personal expenses
Overlooking barter-type transactions

Review each intercompany entry carefully before finalizing the disclosure.

6. Plan for Connected-Person Benefits

Payments to business owners, directors, or their family members (connected persons) must also be arm’s length. This includes:

Salaries and bonuses
Housing, rent, or travel allowances
Consultancy fees

If these go above AED 500,000, they must be disclosed and benchmarked. If not properly supported, the FTA may deny deductions altogether.

7. Watch for Hidden Related Parties

Sometimes relationships aren’t obvious. For example, two companies each owned 50% by the same individual are considered related parties under UAE tax law. These must be disclosed, even if their financial transactions are minimal.

Pitfalls to Avoid

Missing relationships due to narrow definitions
Failing to attach proper documentation (or not having it ready)
Assuming intra-group payments are too small to matter
Using outdated or global benchmarking not relevant to the UAE
Submitting incomplete or inconsistent entries

Final Thoughts: Compliance Is a Process, Not a One-Off Task

Filing a compliant TP Disclosure Form is not just about avoiding penalties—it’s about building trust with the FTA and showing that your internal processes are sound.

Start early. Keep clean records. Benchmark proactively. Document everything.

A complete and accurate disclosure positions your business as tax-compliant and audit-ready.

If you’d like help reviewing your TP positions or preparing the documentation pack, feel free to reach out.