The UAE Federal Tax Authority has issued its Scope and Registration – Top-up Tax Guide, providing detailed guidance on which entities must register under the UAE Domestic Minimum Top-up Tax rules and how that registration can be completed.

The rules generally apply to UAE entities and permanent establishments that form part of an in-scope multinational enterprise group. Businesses should determine their scope, registration method and deadline well in advance, particularly where several UAE entities belong to the same group.

Which multinational groups are within scope?

The UAE’s Qualified Domestic Minimum Top-up Tax legislation generally applies where:

• The group is a multinational enterprise group operating through entities or permanent establishments in more than one jurisdiction; and
• The group recorded annual consolidated revenue of at least EUR 750 million in at least two of the four fiscal years immediately preceding the tested fiscal year.

The revenue of the tested fiscal year itself is not used when applying this threshold test. The UAE Top-up Tax rules apply to fiscal years beginning on or after 1 January 2025.

Who must register for UAE Pillar Two Top-up Tax?

An entity located in the UAE that is subject to Top-up Tax under the QDMTT legislation must register with the FTA.

Depending on the structure of the multinational group, this can include:

• UAE constituent entities;
• UAE permanent establishments of foreign main entities;
• Minority-owned constituent entities located in the UAE;
• Joint ventures and joint-venture subsidiaries located in the UAE;
• Certain reverse hybrid entities created under UAE law; and
• A Domestic Designated Filing Entity, if one is appointed.

Registration for Corporate Tax does not replace Pillar Two registration. An entity that falls within the QDMTT registration requirements must register for Top-up Tax even when it already has a UAE Corporate Tax registration number.

Similarly, an entity that is not required to register for ordinary Corporate Tax purposes may still have a separate Pillar Two registration obligation if it is subject to the QDMTT legislation.

The entity-by-entity registration approach

Under the entity-by-entity approach, each UAE entity that is subject to Top-up Tax submits its own registration application.

Following approval, the FTA issues a separate Pillar Two Top-up Tax Registration Number to every successfully registered entity.

This approach may be suitable where the multinational group has only one UAE entity or prefers each entity to manage its own Pillar Two obligations.

The Domestic Designated Filing Entity approach

As an alternative, an eligible Domestic Designated Filing Entity, or DDFE, may be appointed to reduce the group’s administrative burden.

The appointed DDFE submits the registration application on behalf of the members of the relevant domestic group. It is also responsible for filing the Top-up Tax Return and paying the Top-up Tax on behalf of the entities it represents.

Even when a DDFE is appointed, the FTA issues a Pillar Two Top-up Tax Registration Number to each represented entity. A group-level registration number is also issued to the DDFE.

The DDFE must be a member of the domestic group it represents.

When might more than one DDFE be needed?

A multinational group may have both a Domestic Main Group and a Domestic Joint Venture Group. If the group adopts the DDFE approach for both, it must appoint separate DDFEs:

• One qualifying member of the Domestic Main Group; and
• One qualifying member of the Domestic Joint Venture Group.

Each DDFE submits a separate registration application for the group it represents.

For a Domestic Main Group and a Domestic Minority-Owned Subgroup, however, the same entity should generally act as DDFE where the DDFE approach is adopted.

Are UAE permanent establishments required to register?

A permanent establishment located in the UAE can be treated as a separate constituent entity for Pillar Two purposes and may therefore require its own registration.

This can produce different results from ordinary Corporate Tax registration. For example, a foreign company may have one Corporate Tax registration in the UAE while its separate UAE permanent establishments are treated as separate constituent entities for QDMTT purposes.

A UAE permanent establishment generally does not escape the registration requirement merely because it is treated as a Qualifying Free Zone Person for Corporate Tax purposes.

The guide identifies limited cases where a permanent establishment is not required to register, including where its main entity is an Excluded Entity or where the permanent establishment is stateless.

Registration may still be required when Top-up Tax is zero

An important clarification is that a zero Top-up Tax calculation does not automatically remove the registration obligation.

An in-scope entity must generally still register where its Top-up Tax is deemed to be zero because of provisions such as:

• The de-minimis exclusion;
• The Transitional Country-by-Country Reporting Safe Harbour;
• The Simplified Calculations Safe Harbour; or
• The initial phase of international activity provisions.

Groups should therefore assess registration separately from the calculation of the eventual Top-up Tax liability.

Which entities may not be required to register?

Entities that do not fall within the charging provisions of the QDMTT legislation are not required to register.

Examples identified in the FTA guide include:

• Certain Excluded Entities;
• Investment Entities located in the UAE;
• Stateless permanent establishments; and
• Certain stateless tax-transparent entities.

The meaning of an Excluded Entity under the Pillar Two rules is not identical to an Exempt Person under the UAE Corporate Tax Law. A Corporate Tax exemption should therefore not be treated as automatic confirmation that no Pillar Two registration is required.

What is the UAE Pillar Two registration deadline?

The registration deadline depends on the entity’s first fiscal year within the scope of the QDMTT legislation:

• For a fiscal year ending before 30 April 2026, registration must be submitted on or before 30 November 2026.
• In other cases, registration must generally be submitted within seven months from the end of the first fiscal year in which the entity is within scope.

Where a UAE entity is acquired by an in-scope multinational group, the entity should assess its registration deadline based on the first fiscal year in which it becomes a member of that group.

What is the penalty for late registration?

Failure to submit a registration application within the applicable deadline may result in an administrative penalty of AED 10,000.

Where a DDFE fails to register several represented entities by the required deadline, the AED 10,000 penalty may apply separately to each entity that was not registered on time.

How is registration completed?

Pillar Two registration is completed through the EmaraTax portal.

An entity already registered for another UAE tax should use the same Taxable Person profile when applying for Top-up Tax registration.

An entity that has not previously registered with the FTA must first create a Taxable Person profile and Tax Identification Number before submitting its Pillar Two registration.

What documents may be required?

The FTA guide identifies the following supporting documents:

• Documents verifying the name and Tax Identification Number of a foreign Ultimate Parent Entity;
• Documents verifying the name and Tax Identification Number of a foreign Designated Filing Entity, where applicable; and
• Documentation showing the multinational group’s corporate structure.

The FTA may request additional information or documents when reviewing the application.

If a DDFE is appointed, every entity represented by it must authorise the appointment. This may be completed through acknowledgement on EmaraTax or through signed letters of authorisation uploaded with the application.

DDFE and Designated Local Entity are different roles

A Domestic Designated Filing Entity and a Designated Local Entity perform different functions.

The DDFE is responsible for registration, the Top-up Tax Return and payment obligations for the domestic group it represents.

A Designated Local Entity is appointed specifically to file the Pillar Two Information Return.

A group may appoint different entities for these roles, or the same eligible UAE entity may perform both roles when properly authorised.

Recommended next steps for UAE groups

1. Confirm whether the EUR 750 million consolidated revenue test is satisfied.
2. Identify every UAE constituent entity, permanent establishment, joint venture and minority-owned entity.
3. Determine whether any entity qualifies as an Excluded Entity or falls outside the charging provisions.
4. Decide whether to use individual registration or appoint one or more DDFEs.
5. Gather the group-structure and identification documents required for registration.
6. Confirm the registration deadline for each entity.
7. Complete the registration through EmaraTax before the applicable deadline.

Business Catalyst Consulting can assist multinational groups with Pillar Two scope assessments, entity mapping, registration planning and compliance support.

Learn more about our UAE Pillar Two advisory services or contact Business Catalyst Consulting to discuss your group’s position.

This article provides general information and should not be treated as legal or tax advice. The application of the UAE Pillar Two rules depends on the facts, group structure and applicable legislation.