Corporate Tax Fines and Penalties in UAE
The Federal Tax Authority (FTA) has issued a notification regarding the implementation of corporate tax fines and penalties in the UAE. Non-compliance with corporate tax laws will result in fines starting from August 1, 2023.
Business entities operating in the UAE are obligated to comply with the corporate tax regulations to prevent incurring penalties and fines. This requirement applies to all companies in the UAE, including those in mainland and free zones. It is essential for companies to complete the corporate tax registration process and ensure timely payment to avoid facing corporate tax penalties in the UAE.
Corporate Tax Penalties
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No.
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Description of Violation
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Administrative Fine Penalty Amount in AED
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|
1
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Late Corporate Tax Registration fine.
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AED 10,000
|
|
2
|
Late Corporate Tax Deregistration fine.
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Late submission incurs AED 1,000 penalty, increasing by AED 1,000 monthly, up to a maximum of AED 10,000.
|
|
3
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Penalties apply if records and information required by the corporate tax law are not kept up to date.
|
- One of these shall apply
- AED 10,000 for each infraction.
- AED 20,000 for repeated offenses committed within 24 months of the past violation.
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|
4
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Late Corporate Tax Return Submission fine.
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- AED 500 per month (or part thereof) for the first twelve months.
- AED 1,000 per month (or part thereof) from the thirteenth month onwards, starting from the day after the Tax.
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|
5
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Unsettled Payable Corporate Tax Fine.
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- 14% per annum on unsettled Payable Tax, applied monthly from the day after the due date of payment.
- Due date of payment for Voluntary Disclosure: 20 Business Days from submission. For Tax Assessment: 20 Business Days from receipt.
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6
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Incorrect Corporate Tax Return submission.
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AED 500, unless the Person corrects the Tax Return before the submission deadline as per Corporate Tax Law.
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7
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Late submission of a Corporate Tax Declaration to the Authority.
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- First 12 months: AED 500 per month.
- From the thirteenth month onwards: AED 1,000 per month.
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8
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Not submitting tax-related data, records, and documents in Arabic to the Authority when requested.
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AED 5,000
|
|
9
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Not facilitating the Tax Auditor during a Tax Audit.
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AED 20,000
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How to avoid corporate tax fines and penalties in UAE?
Businesses and corporations governed by corporate tax laws must prioritize compliance with regulatory standards to prevent incurring administrative penalties. Remaining abreast of tax law updates and changes is essential for businesses to uphold their financial integrity and legal compliance. Should you require further information or have specific inquiries regarding corporate tax penalties in the UAE, please do not hesitate to contact us.
Corporate Tax Services in UAE
EasyBooks Accounting & Bookkeeping LLC is an accounting and audit firm in the UAE, providing top-notch corporate tax services. Our firm specializes in delivering timely and exceptional corporate tax solutions, ensuring our clients maintain full compliance with relevant tax regulations and stay abreast of any corporate tax updates or changes.
