Family, salary and benefits

Can my company pay my children's school fees as an expense?

Often questioned by the tax authority: take care

In short: Not by default: school fees are a personal family cost. They can become a staff cost the company may take off its profit when they are part of a documented employment package (written into the employment contract). For an owner-manager, only within the market-value and documentation rules. The FTA (the UAE tax authority) may look at them closely.

The basic rule

Personal and family spending is not a business cost and does not count, even if the company account pays it. Pay for real work, including benefits such as a school allowance, is a business cost when it is written into a contract.

When it is different

Employee (not related to you): school fees or an education allowance written into the employment contract or a documented staff policy are generally deductible as part of employment costs.
Owner-manager of a company (for example an FZ-LLC): you are a Connected Person. A benefit such as school fees is deductible only if it is part of your documented remuneration (employment contract or board/shareholder decision), the total package corresponds to market value for the work you actually do, and it is incurred for the business.
Sole establishment or freelancer (natural person): you cannot employ yourself. Paying your children's school fees from the business is a personal withdrawal and is not deductible.
Paid without any contract or decision, or 'just because the company has cash': treated as a personal expense or a distribution, not a deductible cost.
VAT: tuition at recognised schools is generally zero-rated, so there is often little VAT involved. Where VAT is charged (for example on transport or uniforms), input tax on benefits given to employees for their personal use is generally not recoverable, unless labour law requires the benefit, or a contract or documented policy provides it so the employee can perform their role and this is normal business practice.

Documents to keep

Employment contract or board/shareholder decision listing the education benefit
Payroll records showing the benefit as part of the package
Evidence that the total package is in line with the market for the role (for a Connected Person)
School invoices addressed consistently with the arrangement

How safe is it?

Often questioned by the tax authority: take care High for an owner-manager or a family member: it is a typical point of scrutiny. Low to medium for an unrelated employee with a clear contract.

When to ask a professional

Have it confirmed by an FTA-registered tax agent before you set up a package that includes school fees for yourself or a relative. Who can confirm it for your own case: an FTA-registered tax agent (a tax professional approved by the UAE tax authority), or the optional year-end review in SoloBooks.

If you pay no Corporate Tax this year (Small Business Relief): If you use Small Business Relief this year, you pay no Corporate Tax anyway, so this cost does not change your tax for that year. Keep the documents anyway: they back up your income figure, and they matter if you stop qualifying later.

Check it with the free calculator: Small Business Relief calculator →

Sources

Federal Decree-Law No. 47 of 2022 on the Taxation of Corporations and Businesses (consolidated, unofficial English translation) — Art. 28(1), 28(2)(a), 36(1)–(2), 34
FTA Corporate Tax Guide: Determination of Taxable Income (CTGDTI1) — Sections on employee benefits and payments to Connected Persons
Executive Regulation of the VAT Decree-Law (Cabinet Decision No. 52 of 2017, as amended up to 2025) — Art. 40(1) and 53(1)(c)

Last verified: 19 October 2026

General information, not tax advice. Your situation may differ.

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