UAE: Clarification of terms “director” and “officer” for purposes of limitation on deductibility of payments to connected persons
Corporate Tax Public Clarification CTP010
The Federal Tax Authority (FTA) on April 29, 2026, issued Corporate Tax Public Clarification CTP010 to clarify the meaning of the terms “director” and “officer” for purposes of Article 36 of the UAE Corporate Tax Law, which provides that payments to connected persons are deductible only to the extent they correspond to the market value of services or benefits provided in exchange and are made exclusively for business purposes.
The clarification emphasizes that the assessment of whether an individual qualifies as a “director” or “officer” must be based on the substance of the individual’s authority and role, rather than job titles alone. The clarification also includes practical examples that assist in determining how these terms may apply in practice.
Read a May 2026 report prepared by the KPMG member firm in the UAE