UAE R&D Tax Credit: Complete Legislation Walkthrough

Chapter 1: Introduction & Agenda On the 1st of January 2026, the UAE brought into force a Research and Development Tax Credit. It is the first of its kind in the region, a legislated, non-refundable credit of up to fifty percent on qualifying R&D expenditure, with a maximum benefit of AED two million per year. The legislation is now live. But the full operational rulebook, Ministerial Decision 24, was only published in March 2026. So the complete picture has been available for a matter of weeks. Today I'm walking you through both pieces of legislation, Article by Article, covering exactly what the rules say, what the numbers are, and where the traps sit. If you're a CFO, a finance director, a tax adviser, or a lawyer advising on M&A or restructuring in the UAE, this is the most detailed walkthrough available, and it's built directly from the source legislation. I'm Shoayb from RDvault. We specialise exclusively in UAE R&D tax credits, from eligibility assessment through to pre-approval applications and ongoing compliance. Let me take you through the structure. We start with the legislative hierarchy, how these two decisions sit within the Corporate Tax framework. Then we move through who qualifies, the five R&D criteria, the tiered rate structure with a worked example, qualifying expenditure in and out, the pre-approval process, claw-back rules, carry-forward and transfer, record-keeping, startup-specific considerations, and finally the open questions that the legislation hasn't yet answered. Every chapter is timestamped in the description below, jump to whatever is most relevant to you. Let's start at the top. Chapter 2: The Legislative Framework To understand this credit you need to understand where it sits in the legal architecture. At the top is the Corporate Tax Law, Federal Decree Law Number 47 of 2022, as amended by Federal Decree-Law Number 28 of December 2025. That amendment specifically enables the Cabinet to create an R&D tax credit by decision. The Cabinet exercised that power and issued Cabinet Decision 215 of 2025. This is the primary R&D statute, it defines the credit, sets out who qualifies, and establishes the conditions. The Ministry of Finance then issued Ministerial Decision 24 of 2026, published on the 18th of March 2026. This is the operational rulebook. It contains the rate table, the five R&D activity criteria, the pre-approval mechanism, the expenditure rules, the record-keeping requirements, and the anti-abuse provisions. Both decisions apply from the 1st of January 2026. Cabinet Decision 215 is the substantive law, what the credit is and who it applies to. Ministerial Decision 24 is the working document, how you build and submit a claim. Ministerial Decision 24/2026: What It Means for UAE R&D Tax Credits Chapter 3: Who Qualifies — The Qualifying Entity Test The first question is always: does this entity qualify? The Cabinet Decision defines a Qualifying Entity, and there are cumulative requirements, all must be satisfied. First: the entity must be a juridical person, a company or equivalent legal entity, incorporated or established in the UAE under UAE law, and subject to Corporate Tax and/or Top-up Tax. Foreign companies operating through a UAE Permanent Establishment may also qualify under a separate pathway in the legislation. Second: it must be subject to Corporate Tax and/or Top-up Tax. Cabinet Decision 215, Article 1 defines a Qualifying Entity as one that is subject to Corporate Tax and/or Top-up Tax. The standard Corporate Tax rate is nine percent, but this also includes multinational enterprises subject to the fifteen percent Domestic Minimum Top-up Tax under Cabinet Decision 142 of 2024. If the entity is outside both the Corporate Tax and Top-up Tax regimes entirely, or has elected Small Business Relief, it does not qualify. Free Zone entities have a separate pathway we'll cover next. Third: the R&D activities must be conducted in the UAE. This is a territorial condition. Work done offshore, even if paid for by a UAE entity, does not generate credit entitlement under this regime. Fourth: qualifying R&D expenditure must reach at least AED 500,000 per R&D Project in the tax period. That is per project, not an aggregate entity-level threshold. If a company runs three R&D projects and one of them has only AED 300,000 of qualifying expenditure, that project does not qualify, even if the other two are well above the threshold. And importantly, this AED 500,000 is calculated before the thirty percent staff cost uplift we'll discuss later. Fifth, and this is one the market is not yet focused on: the entity must be beneficially entitled to a share in the returns derived from exploiting the R&D outcomes. This comes from Article 3(1)(d) of the Cabinet Decision. It means the entity claiming the credit cannot merely perform R&D as a service. It must benefit from the resulting IP, know-how, or commercial outputs. This has significant implications for multinational groups where a UAE subsidiary performs R&D but the resulting intellectual property is contractually owned by a foreign parent. If the UAE entity bears the cost but does not benefit from the outcomes, the credit may not be available. Any group with centralised IP ownership needs to review this condition carefully. Article 3(1) of the Cabinet Decision also includes two further conditions: the R&D Project must have a specified objective to increase the stock of knowledge or devise new applications, and the entity must comply with all requirements of this Decision and any decisions issued by the Minister or Council. Those are conditions (e) and (f), they are primarily procedural, but they are cumulative requirements in the legislation. So in summary: UAE-incorporated juridical person, subject to Corporate Tax or Top-up Tax, R&D on UAE soil, at least AED 500,000 per project, beneficial entitlement to the R&D results, a specified knowledge objective, and full compliance with the Decision's requirements. Miss any one, you are outside the credit. Chapter 4: Free Zone Pathways Free Zones deserve specific attention. A Qualifying Free Zone Person, a QFZP, paying zero percent Corporate Tax on Qualifying Income is not automatically excluded. The legislation provides two alternative pathways for Free Zone entities. Pathway one: the QFZP is subject to Corporate Tax at nine percent on Taxable Income for the relevant period, and that Taxable Income is derived from the R&D activities. This catches Free Zone businesses that have non-qualifying income taxed at the standard rate. Pathway two: the entity is subject to the Domestic Minimum Top-up Tax, DMTT, for the fiscal year in which the R&D expenditure is incurred. DMTT is the UAE's implementation of OECD Pillar Two, the global minimum tax framework. It applies to businesses that are part of a multinational group with consolidated revenues of EUR 750 million or more. For these entities, even within a Free Zone, there is a top-up tax liability bringing the effective rate to fifteen percent. Now, the technical question: how does a non-refundable R&D credit interact with DMTT calculations? Under the GloBE rules, the OECD framework that Pillar Two implements, the treatment of a tax credit depends on whether it is classified as a Qualified Refundable Tax Credit. A non-refundable credit that is not so classified would normally reduce covered taxes, which could paradoxically increase the top-up tax liability. The UAE legislation addresses this directly. The Ministerial Decision dedicates Article 14 to the application of the R&D credit within Domestic Groups subject to DMTT. The credit can be utilised against Top-up Tax liability, and Article 14(2) specifies how the Top-up Tax is reduced by the credit amount. But whether this domestic treatment is fully aligned with the OECD's peer review of the UAE's DMTT framework remains an open question for large MNE groups. Entities excluded entirely under Article 4 of the Cabinet Decision: first, any entity that is neither subject to Corporate Tax nor Top-up Tax; second, any entity that has elected Small Business Relief under Article 21 of the Corporate Tax Law; and third, any other entity that the Minister may specify by future decision. That is an exhaustive list as the legislation currently stands. Chapter 5: The Five R&D Criteria Now the heart of the credit: what qualifies as Research and Development? The Ministerial Decision defines a Qualifying R&D Activity as work that meets all five of the following criteria simultaneously. Not a majority, all five. One, Novel. The activity must aim to produce new findings. Replicating existing techniques or adapting known methods in a straightforward way does not meet this test. Two, Creative. The work must involve original concepts or hypotheses. A product development roadmap built on known engineering is generally not creative in this sense. Three, Uncertain. There must be genuine scientific or technological uncertainty, not commercial risk, but uncertainty about whether the technical outcome is achievable, or by what method. If a competent professional in the field could have predicted the outcome in advance, this test likely fails. Four, Systematic. The work must follow a plan and budget. Ad hoc experiments or undocumented tinkering do not qualify. This requirement directly drives the record-keeping obligations we cover later. Five, Transferable or reproducible. The results must be capable of being applied or replicated in other contexts. This separates genuine research from one-off bespoke solutions. The Ministerial Decision states that assessment of whether an activity meets these criteria shall be made having regard to the Frascati Manual, the OECD's standard framework for measuring R&D activities. The statutory language is 'having regard to', meaning the Frascati Manual is the primary reference document, though not strictly binding UAE law. In practice, expect the Emirates R&D Council to rely on it heavily. One important exclusion: the regime explicitly does not cover R&D in social sciences, humanities, or the arts, Article 3(4) of the Ministerial Decision. This is a scientific and technological R&D credit only. One warning: routine software development, product improvement, and engineering work do not qualify simply because they are labelled as R&D in project documentation. The Council will assess substance, not labels. Incorrectly classifying activities as R&D, particularly where there is no evidence of genuine technical uncertainty, is one of the highest risk areas for claim challenge or denial. Chapter 6: The Rate Table & Worked Examples The rate table. This comes from Article 2 of the Ministerial Decision, and I need to correct almost every summary I have seen online. The credit is not a flat rate. It is a marginal, banded calculation, different portions of your expenditure attract different rates. Band One. The first AED one million of qualifying expenditure. Rate: fifteen percent. Maximum credit: AED 150,000. Requires at least two R&D staff on average. Band Two. Expenditure from AED one million to AED two million. Rate: thirty-five percent. Maximum credit: AED 350,000. Requires at least six R&D staff. Band Three. Expenditure from AED two million to AED five million. Rate: fifty percent. Maximum credit: AED 1,500,000. Requires at least fourteen R&D staff. Maximum possible credit: AED two million. Expenditure above AED five million generates no additional credit. The critical point most summaries miss, from Article 2(7): you must satisfy both the expenditure threshold and the headcount threshold to access each band. If either is not met, the rate adjusts downward to the highest band where both conditions are satisfied. So if you have AED four million of expenditure but only eight R&D staff, you cannot access Band Three. Eight is above Band Two's threshold of six, but below Band Three's fourteen. You get Bands One and Two only. The remaining two million generates zero credit. And this credit is non-refundable. If the credit exceeds your Corporate Tax liability for the period, no cash refund. You carry the excess forward. For early-stage businesses with little or no tax liability, this shapes the entire strategy, which we will come to. Let me put the banded calculation and the dual threshold together in a worked example. Scenario A. A UAE technology company has AED 6 million of qualifying R&D expenditure. They have eight full-time equivalent R&D staff. Band One: eight is above the threshold of two. Fifteen percent on AED one million: AED 150,000. Band Two: eight is above the threshold of six. Thirty-five percent on AED one million: AED 350,000. Band Three: eight is below the threshold of fourteen. They cannot access Band Three. Three million of expenditure generates zero credit. Total credit: AED 500,000. Scenario B. Same company, same AED 6 million of expenditure. But they have restructured their R&D workforce, bringing in a combination of directly employed staff, externally provided workers, and qualifying subcontractor personnel, to reach sixteen full-time equivalents. A quick note on how headcount works here. R&D Staff under the Ministerial Decision includes two categories in the Article 1 definition: direct employees and externally provided workers. Both must be under the supervision, direction, and direct control of the qualifying entity. For subcontracted activities, Article 2(5) separately allows the subcontractor's qualifying personnel to count toward headcount. All three routes contribute to the headcount thresholds. The distinction matters because EPW costs are treated as staff costs, carrying the thirty percent overhead uplift, while subcontractor fees do not. Back to Scenario B. Sixteen is above fourteen, all three bands are now accessible. Band One: AED 150,000. Band Two: AED 350,000. Band Three: fifty percent on AED three million: AED 1,500,000. Total credit: AED two million, the maximum. The difference: AED 1.5 million. Same expenditure. The only change was workforce structure. This is the single most powerful planning lever in the legislation. Understanding the 2-6-14 Staffing Thresholds Chapter 7: Qualifying Expenditure Now let's go through what expenditure qualifies. Articles 8 through 11 of the Ministerial Decision cover the categories. Category one: Staff Costs. Salaries, wages, allowances, medical insurance, pension contributions, end-of-service gratuity, bonuses, benefits in kind, and training costs directly related to R&D activities. The staff must be located in the UAE and under the supervision, direction and direct control of the qualifying entity. That is the exact language from Article 8(2)(b), supervision, direction, and direct control. All three elements. Article 8(3) allows a thirty percent overhead uplift on qualifying staff costs. So if your direct R&D staff costs are AED 2 million, you can claim AED 2.6 million as qualifying expenditure for this category. The thirty percent is a statutory proxy for overheads, the legislation does not itemise what it covers, and you do not need to evidence the individual overhead items. One exclusion: employee stock option plans are specifically carved out. An important sub-category: Externally Provided Workers, defined in Article 8(9). An EPW must satisfy four conditions. First, they are not a director or employee of your entity. Second, they provide services through a staff provider company or as an independent contractor or service provider. Third, and this is the one most people miss, they must be personally obliged to provide the services under a contract with the Qualifying Entity or with the staff provider company, as applicable. The statutory language is 'personally obliged', which in practice means the contract should identify the specific individual providing the services, rather than contracting for a team or a deliverable. Fourth, their services do not constitute subcontracting under Article 10. EPW costs are treated as staff costs, meaning they qualify for the thirty percent uplift, and they count toward your headcount thresholds. The same supervision, direction, and direct control test under Article 8(2)(b) applies to EPWs as it does to direct employees. This is a distinct and valuable planning category. Category two: Consumables. Materials and items that are directly used in R&D activities and are no longer usable in their original form afterwards. This includes laboratory supplies, test materials, prototype components, and specifically includes water, fuel, power, and licence fees for software or databases used in R&D. Consumables sold or disposed of in the ordinary course of business do not qualify. And consumables acquired from another member of the same Tax Group do not qualify either. Category three: Subcontracting Fees. Payments to third parties for conducting R&D on your behalf. Article 10 sets strict conditions: the subcontractor must be UAE-based, the work must be performed in the UAE, the activities cannot have been subcontracted to you by another party, no back-to-back arrangements, and the subcontractor cannot further subcontract to someone else. If the subcontractor is a Related Party, they must maintain audited financial statements. Intra-group subcontracting within the same Tax Group does not qualify. One additional condition worth noting for MNE groups: subcontracting fees attributable to a Foreign Permanent Establishment of the qualifying entity do not qualify, that is Article 10(1)(e). If your UAE entity also has overseas operations structured as a Foreign PE, this condition requires specific review. The thirty percent overhead uplift does not apply to subcontracting fees, only to direct staff costs and externally provided worker costs. For multinationals sharing R&D across jurisdictions, there is a fourth qualifying category: Cost Contribution Arrangements under Article 11 of the Ministerial Decision. Your proportionate contribution to a CCA, determined at arm's length and proportionate to expected benefit, qualifies as R&D expenditure, to the extent the underlying R&D activities are performed in the UAE. One more category that IFRS preparers need to know about: Article 5(1)(f) of the Cabinet Decision. Where any of the costs in categories (a) through (e), staff, consumables, subcontracting, or CCAs, are capitalised under the applicable accounting standards as internally generated intangible assets resulting from qualifying R&D activities, those capitalised costs still qualify as R&D expenditure. In IFRS terms, development costs meeting the IAS 38 capitalisation criteria do not lose their qualifying status simply because they sit on the balance sheet rather than in the P&L. This is a significant provision, it means entities that capitalise development expenditure under IFRS are not penalised for following the accounting standards. And across all categories, the AED 500,000 minimum threshold applies per R&D Project, calculated before the staff cost uplift. Now the exclusions, and these matter because overstating qualifying expenditure is one of the fastest routes to claw-back. First: Government grants and subsidies. Expenditure funded directly or indirectly by a Grant, as defined in the Cabinet Decision, must be excluded. You cannot claim a tax credit on expenditure that has already been subsidised. The expenditure must also not benefit from any other tax incentive, credit, exemption, or relief under any UAE legislation. Second: Intra-group costs within a Tax Group. The entity that originally incurs R&D costs, employing the staff, purchasing consumables from third parties, engaging external subcontractors, can claim those costs. But if those costs are then recharged or recycled within the Tax Group, the receiving entity cannot claim them. Staff costs recharged from one Tax Group member to another do not qualify. Consumables acquired from a Tax Group member do not qualify. Subcontracting between Tax Group members does not qualify. The legislation prevents double-counting, not first-time claiming. Beyond these specific rules, the entity claiming the credit must bear the financial burden of the R&D and be beneficially entitled to exploit the results. Where a UAE subsidiary funds R&D but the economic return flows to a foreign parent, that disconnect creates material risk. The structuring of IP ownership, cost allocation, and the contractual allocation of functions, risks, and economic returns must all support the claim. Third: Capital expenditure, land, buildings, and long-lived assets, falls outside the qualifying expenditure categories as published in MD 24/2026. Equipment and capital assets are not currently in the qualifying categories. The legislation does provide a mechanism under CD 215/2025 Article 5(1)(e) for the Minister to specify additional qualifying categories by future decision, so this may be addressed in future guidance. For now, capital equipment costs should be treated as non-qualifying. Fourth: Article 15 of the Ministerial Decision, Artificial Separation of Business. If persons have artificially separated their business and the combined qualifying R&D expenditure across the entire business exceeds the thresholds in the rate table, this will be treated as an arrangement to obtain a Corporate Tax advantage. The Authority can counteract it, claw back any credits utilised, and forfeit any unused credits. This is a direct anti-avoidance provision aimed at entities splitting operations to manipulate the banded rate structure. Chapter 8: The Pre-Approval Process This is the most important procedural requirement in the entire credit. Article 4 of the Ministerial Decision establishes a mandatory pre-approval requirement. You cannot simply claim the credit in your tax return. You must first obtain approval from the Emirates R&D Council for each R&D Project. Step one: submit an application describing your R&D activities, confirming how they meet the five criteria, and setting out your qualifying expenditure. Step two: the Council assesses your application. As of April 2026, the pre-approval portal has not yet been formally launched. The operational mechanics, how applications are assessed, turnaround times, evidence standards, are still not fully public. Step three: if approved, you receive confirmation. Step four: you include the credit in your Corporate Tax return for the relevant period, supported by the pre-approval, a breakdown of qualifying expenditure, audited financial statements, and a signed management declaration. A practical point on those audited financial statements: the Cabinet Decision requires audited accounts as part of every R&D credit claim submission. There is no exemption for smaller entities. Many UAE startups and SMEs do not currently prepare audited financials, but if you intend to claim the R&D credit, audited accounts are a mandatory cost of entry. Budget for this from the outset. The practical implication: if you plan to claim for 2026, you need to be building the documentation now, in real time, as the R&D activities are being conducted. Eligibility is established by how activities are actually undertaken during the tax period, not by how they are described at the point of filing. Attempting to reconstruct qualifying R&D positions at year end, without contemporaneous evidence or pre-approval, carries a high risk of challenge or denial. This is a forward-planning exercise, not a year-end adjustment. Chapter 9: Claw-Back, Carry-Forward & Transfer Now the teeth. Article 16 of the Ministerial Decision is the anti-abuse provision. Where it can be reasonably concluded that an arrangement has been adopted mainly or partly to obtain or increase an R&D Tax Credit in a manner inconsistent with the economic substance or the genuine nature of the R&D activity, the Authority can counteract the arrangement, claw back any credits utilised, and forfeit any unused credits. The claw-back window is five years. Article 16(2) specifies the trigger events: if, within five years of the last period in which an R&D credit was claimed, the entity ceases to be a Taxable Person, becomes a Qualifying Free Zone Person, elects Small Business Relief, enters liquidation, or redomiciles outside the UAE, any credits utilised must be repaid, and any unused credits are forfeited. A credit claimed in 2026 remains at risk until 2031. For M&A due diligence, any acquisition of a UAE company that has claimed R&D credits should include a specific review of the credit methodology and pre-approval documentation. And note: the SBR trap works retrospectively here. If you claim and use the R&D credit in 2026, then your revenue drops in a subsequent year and your accountant elects Small Business Relief for 2027 or 2028, the 2026 credit you already used is clawed back. This means no SBR election for at least five years after your last R&D credit claim. Make sure your advisers understand this. On business restructuring specifically, Article 7 of the Ministerial Decision deals with transfers of R&D credits in the context of a business transfer. The transferee must continue the R&D activities for at least two years. If the activities are discontinued within that window, the credit is clawed back, forfeited, and penalties apply. The transferred credit cannot shelter behind other tax losses or reliefs. The message: R&D credits require the same rigour as any material tax position. The downside risk is real. Three provisions particularly important for larger organisations. Carry-forward. Where the credit exceeds your Corporate Tax liability, the excess carries forward to future periods. There is no stated time limit. However, carry-forward is conditional on maintaining at least fifty percent ownership continuity, or, if ownership changes beyond fifty percent, the business must continue substantially the same activity. Listed entities on a Recognised Stock Exchange are exempt from the ownership continuity test. Transfer of credits. Credits can be transferred between entities within a group, but the ownership threshold is seventy-five percent common ownership, and that ownership must be maintained from the beginning of the period in which the credit arose through to the end of the period in which it is used. The transferred credit must be used in the period of transfer, it cannot be further carried forward or transferred by the receiving entity. Tax groups. Where a Tax Group exists, R&D expenditure and staff headcount are aggregated across all qualifying members. The credit is applied against the consolidated group tax liability. Pre-Grouping R&D credits, credits arising before an entity joined the group, are utilised first. If a member leaves the group, the credit stays with the group, except for any unused pre-Grouping credits. The Parent Company is responsible for pre-approval and claiming. And if the Tax Group applies for a credit that is later found to be invalid, every member is jointly and severally liable for the claw-back. Chapter 10: Record-Keeping Article 12 of the Ministerial Decision sets the record-keeping standard. All records supporting an R&D credit claim must be retained for seven years following the end of the tax period to which they relate. A credit claimed for 2026, records must be kept until at least 2033. Written documentation: project plans, objectives, research protocols, experimental designs, progress reports, and management sign-offs. Visual and technical records: lab notebooks, test results, photographs of prototypes, engineering drawings, software version control logs. Electronic data: all digital records must be accessible to the Federal Tax Authority and the Emirates R&D Council on request. Contemporaneous evidence is the gold standard. Records created at the time the work was done, not reconstructed afterwards. A project log created six months later when an audit is looming is worth considerably less than a notebook entry from the day the experiment was run. The documentation must be sufficient to demonstrate both the technical basis, that the activities meet the five R&D criteria, and the financial basis, that the expenditure is properly calculated and linked to qualifying activities. These two threads must connect. Technical documentation without financial backing, or financial claims without technical evidence, will not sustain a claim. The seven-year retention period extends beyond the five-year claw-back window, giving the authorities an audit trail that outlasts the challenge period. Chapter 11: Startups & SMEs Everything we've covered applies equally to profitable companies and early-stage businesses. But there are specific considerations I need to address. Point one: the Small Business Relief trap. Under the Cabinet Decision, entities that elect Small Business Relief are excluded from the R&D credit. If you elect SBR for 2026, you cannot claim the credit for 2026. There is no mechanism to reverse this. Elections for 2023, 2024, and 2025 are irrelevant, the R&D regime only applies from 2026 onwards. The 2026 election is the one that matters. The mistake happens when accountants automatically file 2026 returns on the same basis as prior years, ticking SBR again out of habit. The first 2026 returns are not due until approximately September 2027. That sounds like plenty of time. It is not. The decision must be made now, before anyone touches the return. If you are a UAE business conducting R&D with revenue below AED 3 million, do not elect Small Business Relief for 2026 without first assessing your R&D credit position. Point two: the carry-forward is not a consolation prize, it is the strategy. A startup with zero tax liability in 2026 earns the credit but cannot use it immediately. The credit carries forward with no stated time limit. Think of it as a credit bank. A company spending AED 1 million on qualifying R&D with two staff earns AED 150,000 per year. After three years, that is AED 450,000 accumulated. The moment the business turns profitable, the credit bank depletes the first year's tax liability. The benefit arrives exactly when the business needs it most. Qualify now. Document everything. Build the bank. Point three: funding rounds and ownership continuity. Carry-forward requires at least fifty percent ownership continuity, or, if ownership changes, the business must continue substantially the same activity. For startups approaching a funding round where founder dilution could push external ownership above fifty percent, this requires advance planning. The same-business exception should apply to a genuine R&D-led startup, but it is not automatic. Confirm it before the round closes. Point four: headcount for lean teams. The Ministerial Decision requires assessment of R&D criteria to be made having regard to the Frascati Manual. The Frascati Manual recommends that individuals spending less than ten percent of their working time on R&D should not count toward headcount totals. An engineer dedicating one day a month to R&D almost certainly does not meet your minimum two-staff threshold. Use the ten percent baseline as your starting position when assessing headcount eligibility. These points apply to early-stage businesses, but the legislation is equally relevant to established companies and enterprise groups. The IP beneficial entitlement condition, the Tax Group aggregation mechanics, Cost Contribution Arrangements for MNEs sharing R&D across jurisdictions, and the interaction between the credit and Pillar Two DMTT obligations all require structuring at an enterprise level. The credit is designed for businesses of all sizes, and the planning opportunities scale accordingly. UAE R&D Tax Credits for Startups & Loss-Making Companies uae-rd-tax-startup-loss-making-companies Chapter 12: Open Questions I said at the start that I would cover what the legislation does not yet answer. Here are the open questions as of April 2026. First: the pre-approval portal. The Emirates R&D Council has not yet launched the formal application portal. The form, turnaround time, and evidence standard remain unpublished. Second: Phase Two, refundable credits. The Ministry of Finance has publicly indicated that refundable R&D credits are being considered as a future development. This would transform the value of the credit for pre-profit businesses. No timeline has been given. Third: subcontractor headcount mechanics, the precise FTE counting methodology for mixed-function subcontractors and the treatment of partially UAE-based work. Fourth: the interaction between the R&D credit and DMTT calculations for large MNE groups, specifically the classification of the credit under GloBE rules and the alignment between the UAE's domestic mechanism and the OECD's peer review framework. At RDvault, we work exclusively in UAE R&D tax credits. We help companies assess eligibility, structure pre-approval applications, build expenditure calculations, and manage ongoing documentation and compliance programmes. Visit rdvault.ae to book a call. The link is in the description. 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