23 August 2026 · Scope
Who Is In Scope of the UAE DMTT
The UAE Domestic Minimum Top-up Tax (DMTT) applies only to large multinational enterprise (MNE) groups with consolidated annual revenue of at least EUR 750 million in at least two of the four financial years immediately before the tested year. It took effect for financial years starting on or after 1 January 2025, so groups with calendar-year accounts are already inside their first in-scope period. The test is applied at the level of the ultimate parent's consolidated financial statements, not any single UAE entity, which is why even a modest UAE branch or subsidiary of a large foreign group can be pulled into scope. If your group sits below that threshold, which describes the vast majority of UAE businesses, including most standalone companies, family businesses and free zone SMEs: the DMTT simply does not apply, and your UAE tax position stays exactly as it was, at 0% (as a Qualifying Free Zone Person) or the standard 9% rate.
Exiloz Management & Tax Consultant · Dubai-based FTA-focused advisory · VAT, corporate tax & accounting
Only the largest groups
DMTT is a Pillar Two measure aimed squarely at the world's largest multinationals, not at UAE SMEs or domestic groups. The EUR 750 million threshold mirrors the country-by-country reporting threshold many groups already track for other purposes, so most in-scope businesses have this figure to hand already. Because the test looks back at two of the preceding four years rather than the current year alone, a group can dip below the line this year and still remain in scope, and a group that has only just crossed the line for a second time can be caught for the first time.
- Consolidated group revenue of at least EUR 750 million.
- Met in at least two of the four preceding financial years.
- Applies to constituent entities of in-scope MNE groups.
- Effective for financial years from 1 January 2025.
- The test uses the ultimate parent entity's consolidated financial statements.
- Revenue is measured in euros, so exchange rate movements can affect the result.
- Scope is reassessed every financial year, not decided once and forgotten.
- Joint ventures and minority-owned entities can follow their own scope rules.
Most UAE businesses are out
If you run a standalone UAE company, a family-owned group without material overseas revenue, or an SME trading only within the Emirates, DMTT is not something you need to act on. The rule targets a small number of very large groups, and ordinary corporate tax payers are unaffected by it. Even where a UAE company sits inside a wider foreign structure, scope is decided by the ultimate parent's global consolidated revenue, not by the UAE entity's own turnover, so a modestly sized UAE company can still be outside scope if its parent group never reaches EUR 750 million.
- Purely domestic groups below EUR 750 million are excluded.
- Standalone UAE companies are not in scope.
- Certain excluded entities (e.g. government, non-profits) are carved out.
- Your rate remains 0% (QFZP) or 9% as normal.
- Excluded categories also generally include qualifying pension and investment funds.
- A UAE company inside a small foreign group is still out of scope.
- No new registration or filing is triggered for out-of-scope businesses.
How the lookback actually works
Picture a group with consolidated revenue of EUR 680 million, EUR 790 million, EUR 760 million and EUR 705 million across the four years before the tested year. Because revenue cleared EUR 750 million in two of those four years, the group is in scope even though it fell below the threshold in the other two years and even though its most recent year could dip again. This backward-looking design means scope cannot be timed away by a single quiet year, which is exactly why groups hovering near the line should start monitoring the test well before they expect to cross it.
- The test counts any two years out of the four, not just consecutive ones.
- A single year above the threshold is not enough on its own to trigger scope.
- Groups near EUR 750 million should track the metric every single year.
- Falling below the threshold in the current year does not exit scope automatically.
Related guides
Frequently Asked Questions
For groups checking whether Pillar Two reaches them, and for finance teams tracking the threshold year to year.
Does DMTT apply to my SME?
Almost certainly not. DMTT only reaches MNE groups with consolidated revenue of EUR 750 million or more in at least two of the last four years, a bar that excludes the vast majority of UAE SMEs, family businesses and standalone companies. If your business has never filed a country-by-country report or belonged to a large multinational group, you can generally treat this rule as outside your compliance calendar.
How is the EUR 750 million measured?
On the ultimate parent's consolidated revenue as reported in its consolidated financial statements, not on any single UAE entity's turnover. The threshold must be met in at least two of the four financial years immediately preceding the tested year, so both current performance and recent history matter. Currency conversion to euros is part of the test, which means exchange rate movements can occasionally push a borderline group in or out of scope.
When did DMTT start?
For financial years beginning on or after 1 January 2025. A group with a calendar-year financial year is therefore already inside its first DMTT year, while a group with a non-calendar year should confirm exactly when its first in-scope period began.
Does the size of my UAE entity matter?
No. Scope is decided at the level of the global group's consolidated revenue, not the size or profitability of the UAE operation. A UAE subsidiary or branch with modest local revenue can still be swept into DMTT purely because its foreign parent group clears the EUR 750 million bar.
What happens the first time we cross the threshold?
Once your group meets the two-of-four test, every UAE constituent entity of that group becomes subject to DMTT for that financial year and for each year scope continues to apply afterwards. You should expect to register the relevant UAE entities, start collecting GloBE-standard financial data and build the effective tax rate calculation used to work out any top-up.
Are joint ventures and investment funds treated the same way?
Not always. Joint ventures and certain minority-owned entities can be tested separately from the main group, and specific categories such as government entities, pension funds and qualifying investment funds are generally carved out of the GloBE and DMTT rules entirely. These exceptions are technical, so any group with an unusual ownership structure should confirm its position rather than assume the general rule applies.
Can Exiloz confirm our group's status?
Yes. We review your group's consolidated financial statements against the EUR 750 million threshold, check the two-of-four year history, and confirm in writing whether any UAE entity is in scope. Where the position is borderline, we also help set up ongoing monitoring so a future crossing does not catch you by surprise.
Check if your group is in scope
Exiloz tests your consolidated revenue against the EUR 750M threshold, reviews your ownership structure and maps your UAE DMTT exposure before it becomes a filing surprise.