UAE Public Clarification Released On The Application Of The Valuation Method Under The Transitional Rules For Real Estate Developers

On 26 September 2025, the Ministry of Finances ("MoF") of the UAE issued a corporate tax public clarification (the "Public Clarification") on the application of the valuation method under the transitional rules as set out in Ministerial Decision No. 120/2023 on the Adjustments Under the Transitional Rules for the Purposes of Federal Decree-Law No. 47 of 2022 on the Taxation of Corporations ("Ministerial Decision No. 120 of 2023"). Transitional provisions bridge the gap between pre- and post-CIT periods, ensuring fairness for investors regarding gains accumulated before CIT implementation.

This Public Clarification explains how real estate developers who are subject to UAE Corporate Tax should apply the transitional rules when disposing of "Qualifying Immovable Property" (such as land or buildings) that was owned before the start of their first Tax Period. This guidance applies to real estate developers who make offplan sales and recognise revenue from those sales