17 July 2026 · Which Relief
Restructuring vs Qualifying Group Relief
Article 27 business restructuring relief covers the transfer of a whole business or an independent, separately-operable part, typically in a merger, spin-off or other reorganisation. Article 26 Qualifying Group Relief covers transfers of individual assets and liabilities between companies linked by 75%-or-greater common ownership. Both operate on a broadly no gain / no loss basis and both carry a two-year clawback if the structure is broken by an onward disposal. Which one applies depends on what is actually moving: a business (or independent part) points to Article 27, a standalone asset or liability inside a group points to Article 26, and moving nothing at all but wanting consolidated filing may point to a corporate tax group instead. In practice, many groups use more than one of these tools over time — an Article 26 asset transfer to tidy up a subsidiary, then an Article 27 merger a year later, or a tax group running alongside both.
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For business transfers
Use it for mergers and reorganisations. Article 27 is the relief for transferring an operating business, or a self-contained part of one, out of one entity and into another — the kind of transaction where what changes hands is a going concern with its own assets, liabilities, staff and revenue, not a line item on a balance sheet.
- Transfer a whole business or independent part.
- Consideration usually in shares.
- For mergers, spin-offs, reorganisations.
- No gain / no loss, 2-year clawback.
- Both parties must be UAE resident/PE, non-exempt, non-QFZP.
- The transfer needs a valid, documented commercial reason.
For group asset transfers
Use it within a 75% group. Article 26 is the relief for moving individual assets or liabilities — a property, a receivable, a piece of equipment — between companies that are closely enough related by ownership, without needing to show the transfer is of a whole business or independent part.
- Transfer of assets/liabilities within a group.
- 75%+ common-ownership link required.
- Both parties resident and aligned.
- No gain / no loss, 2-year clawback.
- Does not require the moved item to be a business in its own right.
- Simpler scope test than Article 27, but the group-ownership threshold is strict.
How to tell them apart on a real deal
The distinction matters because deals often get filed under the wrong article. Moving a warehouse, a fleet of vehicles, or a single receivable from one sister company to another is an asset transfer — Article 26 territory, and it needs a 75%-or-greater common-ownership link to work. Merging two operating companies, or spinning a division with its own staff and contracts out into its own entity, is a business transfer — Article 27 territory, with no minimum ownership threshold but a stricter test of what is actually moving.
- Ask first: is a business moving, or just an asset?
- Check the ownership link — Article 26 needs 75%+ common ownership; Article 27 does not.
- A business transfer with less than 75% common ownership can still use Article 27.
- An asset transfer at 75%+ ownership almost always fits Article 26 better.
When neither relief is what you need
Sometimes the goal is not a one-off transfer at all — it is ongoing consolidated tax filing across a group. In that case a corporate tax group achieves the outcome without electing either relief, because the group files as a single taxable person rather than transferring assets or businesses between entities. Exiloz can confirm which route — Article 27, Article 26, or forming a tax group — actually matches what you are trying to achieve.
- A corporate tax group consolidates filing without moving assets or businesses.
- Article 27 and Article 26 both involve an actual transfer; a tax group does not.
- The right answer depends on the commercial goal, not just the mechanics available.
- Some groups use a combination — a tax group for ongoing filing, plus a one-off Article 27 or 26 transfer for a specific reorganisation.
- A group considering all three tools should sequence them carefully, since one restructuring can affect the ownership tests for the next.
Related guides
Frequently Asked Questions
For picking the right relief before you structure the deal, not after.
When do I use Article 26 instead of 27?
Use Article 26 Qualifying Group Relief for transfers of individual assets or liabilities within a 75%-or-greater common-ownership group; use Article 27 for transferring a whole business or an independent, separately-operable part, which has no minimum ownership threshold but a stricter test of what is being moved.
Do both have a clawback?
Yes, both carry a broadly similar two-year clawback if the structure is broken by an onward disposal outside the group — the deferred gain becomes taxable in the period the triggering event occurs, under either article.
What common-ownership level does Article 26 need?
A 75% or greater common-ownership link between the companies. Article 27 has no equivalent ownership threshold, but it does require both parties to be UAE resident, or have a UAE PE, and to be non-exempt and non-QFZP.
Can I use Article 27 for a group with less than 75% common ownership?
Yes, if what is moving is a whole business or an independent part — Article 27 does not carry Article 26's 75% ownership requirement. That makes it the relevant relief for mergers and reorganisations involving parties that are not closely enough related for Article 26.
What if I am not sure whether what is moving is a business or just an asset?
The practical test is whether the part being transferred could operate independently, with its own staff, contracts and revenue, the day after the transfer. If yes, it likely qualifies as a business transfer under Article 27; if it is a standalone item with no operational substance of its own, it is more likely an asset transfer under Article 26.
Could a corporate tax group be a better fit than either relief?
Possibly, if the underlying goal is ongoing consolidated filing rather than a one-off transfer. A corporate tax group lets related companies file as a single taxable person without transferring assets or businesses between them at all, which sidesteps the scope questions that Article 26 and Article 27 both raise.
Can I elect both Article 26 and Article 27 relief for the same overall reorganisation?
Yes, provided each individual transfer within the reorganisation independently meets the conditions for the article it is claimed under — a group restructuring often bundles an Article 26 asset transfer and an Article 27 business transfer together, each tested and elected on its own terms.
Can Exiloz pick the right relief?
Yes. We identify whether Article 26, Article 27, a corporate tax group, or simply a taxable transfer fits your transaction, based on what is actually moving and how the parties are related.
Pick the right relief
Exiloz identifies whether Article 26, Article 27 or a corporate tax group fits your restructuring before you commit to a structure.