DMTT — Pillar Two top-up.
Domestic Minimum Top-up Tax — the UAE's implementation of the OECD Pillar Two framework. Effective for financial years beginning on or after 1 January 2025 (Cabinet Decision 142 of 2024).
Who's caught
UAE entities that are part of a Multinational Enterprise (MNE) group with consolidated annual revenue above EUR 750 million in at least two of the four preceding financial years. Most readers of this site will not be in scope.
Effect
Increases the effective UAE tax rate on in-scope entities to 15%, overriding both the 9% standard CT rate and the 0% QFZP rate.
Mechanics
If the effective tax rate paid by the MNE group's UAE entities is below 15%, a top-up tax is calculated to bring it up. The UAE applies its own DMTT (rather than ceding the right to other jurisdictions under the Income Inclusion Rule).
Pillar Two — global context
The OECD Pillar Two framework was agreed by 140+ jurisdictions in 2021. It establishes a global minimum effective tax rate of 15% for large MNE groups. The UAE's DMTT is one of several "domestic top-up" implementations.