UAE Unveils Comprehensive Penalty Structure for Breaches of Corporate Tax Regulations

by Editorial

Published 3 Aug 2023

The UAE’s Ministry of Finance has issued Cabinet Decision No. (75) of 2023, concerning penalties for violations of Federal Decree-Law No. 47 of 2022 on corporate and business taxation. The decision details the penalties enforced by the Federal Tax Authority (FTA), effective August 1, 2023.

Some of the specific penalties include:

* For failure to keep required records and information, fines range from Dh10,000 to Dh20,000 in the case of repeated violations.
* A Dh5,000 penalty for not providing data, records, and documents in Arabic when requested.
* Fines from Dh1,000 to Dh10,000 for late submission of deregistration applications.
* Penalties ranging from Dh1,000 to Dh5,000 for failure to inform of necessary amendments to tax records.
* A Dh1,000 penalty for legal representatives failing to notify their appointment on time.
* Monthly penalties ranging from Dh500 to Dh1,000 for late filing of tax returns by legal representatives or registrants.
* A monthly penalty of 14% per annum for failure to settle payable tax.
* Fines of 1% to 15% per month on the tax difference for various violations regarding incorrect tax returns, voluntary disclosures, and failures to submit voluntary disclosures in specific cases.

The new penalties underline the importance of compliance with tax laws and regulations and reflect the government's commitment to ensuring transparency and accountability in the financial sector.