RAKEZ Tax System and Financial Reporting: The Complete 2026 Guide

The three layers of obligations for a RAKEZ company

A company registered in the Ras Al Khaimah Economic Zone (RAKEZ) answers to two regulators. To RAKEZ itself for corporate reporting and the annual audit, without which the licence is not renewed. To the UAE Federal Tax Authority (FTA) for corporate tax registration, the tax return and payment.

One does not replace the other: even a company paying 0% tax still files its audit with RAKEZ and its return with the FTA.

• RAKEZ: annual audited financial statements and licence renewal.
• FTA: corporate tax registration (TRN) and an annual tax return.
• Internal records: IFRS accounting, the ultimate beneficial owner (UBO) register, and transfer pricing documentation for related-party transactions.

Financial statements and the RAKEZ audit

RAKEZ regulations require every company to prepare and submit audited financial statements for each financial year, regardless of size, activity or revenue. The deadline is six months after the financial year-end: with a 31 December year-end, the statements are due by 30 June.

The audit must be carried out by a firm on the RAKEZ approved auditors list; an auditor approved by another free zone does not automatically qualify. Statements are prepared under IFRS. RAKEZ will not renew the licence without the audit, and non-compliance carries penalties.

UAE corporate tax for RAKEZ companies

UAE corporate tax applies to financial years starting on or after 1 June 2023 (Federal Decree-Law No. 47 of 2022). The rate is 0% on taxable income up to AED 375,000 and 9% on taxable income above that amount.

Free zone companies, including those in RAKEZ, are taxable persons: they must register with the FTA and file a return every year. The return is filed and the tax paid within nine months of the end of the tax period. With a 31 December year-end, that means by 30 September of the following year.

The FTA charges penalties for late registration and for each month a return is late, so it pays to keep a deadline calendar from the first year of operation.

The 0% rate: the Qualifying Free Zone Person (QFZP) regime

A free zone company can apply 0% to its qualifying income if it is a Qualifying Free Zone Person (QFZP). Its other taxable income is taxed at 9%.

Every condition must be met at the same time, every year. If even one is breached, the company loses QFZP status from the start of that tax period and for the following four, which means paying 9% on all taxable income for five years in a row.

• Adequate economic substance in the free zone: staff, expenses and assets in proportion to the activity.
• Income from qualifying activities, or from transactions with other free zone persons.
• De minimis: non-qualifying revenue no higher than 5% of total revenue or AED 5 million, whichever is lower.
• Compliance with transfer pricing rules and documentation.
• Audited financial statements, required for every QFZP regardless of revenue (Ministerial Decision No. 84 of 2025).
• No election to be taxed under the standard regime.

What this means for a family office or holding company

For family structures, the list of qualifying activities matters most. Ministerial Decision No. 229 of 2025 (effective retroactively from 1 June 2023) widened it: treasury and financing services now qualify not only when provided to related parties but also for the company’s own account. Holding shares and other securities for its own account is also on the list.

Dividends and capital gains from qualifying shareholdings can also be exempt when the law’s conditions are met (a holding of at least 5%, held for at least 12 months). How these rules apply to a specific structure depends on its activities, counterparties and income sources, which is worth checking before registration rather than after.

Small Business Relief, and when it does not apply

A UAE resident with revenue of no more than AED 3 million in the current and all previous tax periods can elect Small Business Relief: it is treated as having no taxable income and files a simplified return. Ministerial Decision No. 131, announced on 7 August 2026, extends the relief to tax periods ending on or before 31 December 2029.

Important: the relief is not available to Qualifying Free Zone Persons or members of multinational groups. A RAKEZ company has to choose between the QFZP regime and Small Business Relief. A return must be filed either way.

Annual calendar for a RAKEZ company (calendar financial year)

Example for a company with a 1 January to 31 December financial year:

• 31 December: end of the financial year and tax period.
• January to May: year-end close under IFRS, transfer pricing documentation, audit by a RAKEZ-approved auditor.
• 30 June: deadline to submit audited financial statements to RAKEZ.
• 30 September: deadline to file the corporate tax return and pay the tax to the FTA.
• Every year: renew the RAKEZ licence and re-check the QFZP conditions for the next period.

Common mistakes

• Assuming a 0% rate means no filing: the RAKEZ audit and the FTA return are always required.
• Hiring an auditor who is not on the RAKEZ list, so the statements are rejected.
• Earning revenue from UAE mainland clients above the de minimis threshold and losing 0% for five years.
• Skipping transfer pricing documentation for loans and services inside the family group.
• Registering with the FTA late and incurring a penalty before the first return is even due.