Who are 'Connected Persons' under UAE corporate tax, and how do they differ from 'Related Parties'?

'Related Parties' is a broad concept covering any two parties linked by ownership, control, or kinship — such as two companies under the same owner, or family members of each other. 'Connected Persons' is a narrower category within that: specifically, the company's own owner, a director or officer of it, or a related party of theirs. So every Connected Person is a Related Party, but not every Related Party is a Connected Person.

The practical point is this: any amount a company pays to a Connected Person — such as management fees paid to its own owner, or a salary to a relative in a management role — is only deductible from taxable income if it genuinely reflects fair market value and is a real expense incurred for the business. A common example: an owner draws 'consultancy fees' from their own company above what the service is actually worth, in order to reduce taxable profit — the excess can be disallowed by the tax authority, raising the taxed profit. RASEEKH reviews these payments before filing so nothing comes as a surprise.