Who is in scope, in practice
UAE transfer-pricing documentation requirements apply to taxpayers with related-party or connected-person transactions above the prescribed thresholds, and to groups that are part of a multinational enterprise with consolidated revenue exceeding the Master File / CbC thresholds. The Local File requirement, specifically, kicks in earlier and is the one most groups misjudge.
What the Local File must actually contain
The FTA's 2025 guidance is specific. A defensible Local File includes:
- Functional analysis at the level of each material related-party transaction — not summarised at entity level
- Benchmarking analysis with comparables refreshed within the last three years (we recommend annually for material flows)
- Contemporaneous documentation — written by the time the return is filed, not reconstructed during a query
- Year-on-year continuity — explanations for any methodology change from the prior period
The three things to do this year
- Map your related-party flows in absolute terms. Not as a percentage of revenue. The thresholds are absolute.
- Refresh the benchmarking on anything material. Studies older than three years will be challenged.
- Write the file before the filing, not after a query. Reconstructive documentation is the single highest-risk position you can take.