Full List of Fines in UAE For Violations of Corporate Tax Rules Revealed

The UAE’s Ministry of Finance has released Cabinet Decision No. (75) of 2023. This decision provides details on administrative penalties for infringements linked to the Federal Decree-Law No. 47 of 2022 on corporate and business taxation. The penalties will come into effect from August 1, 2023, and will be imposed by the Federal Tax Authority (FTA) for violations related to the application of the Corporate Tax Law.

List of Penalties

Here is the complete list of penalties:

• Failure to maintain required records and information incurs Dh10,000 for each violation or Dh20,000 for repeated violations within 24 months.
• Failure to submit tax-related data, records, and documents in Arabic to the Authority results in a Dh5,000 penalty.
• Moreover, Late submission of deregistration Application under the Corporate Tax Law will lead to a fine ranging from Dh1,000 to Dh10,000.
• Failure to notify the Authority of any required amendment to tax records may incur Dh1,000 for each violation or Dh5,000 for repeated violations within 24 months.
• Legal representatives who fail to provide notification of their appointment within the specified timeframes will face a Dh1,000 penalty.
• Failure of legal representatives to submit tax returns within the specified timeframes will incur Dh500 per month for the first 12 months and Dh1,000 per month from the 13th month onwards.
• Registrants failing to submit tax returns within the timeframe will face Dh500 per month for the first 12 months and Dh1,000 per month from the 13th month onwards.
• Failure to settle payable tax incurs a monthly penalty of 14% per annum, starting from the due date of payment.
• Furthermore, submission of an incorrect tax return results in a Dh500 fine, except if corrected before the submission deadline.
• Voluntary disclosures for errors in tax return, assessment, or refund Application will attract a monthly penalty of 1% on the tax difference.
• Failure to submit voluntary disclosure before being notified of a tax audit results in a 15% fixed penalty on the tax difference, plus a monthly 1% penalty for each month.

These fines are part of the UAE’s efforts to ensure compliance with corporate tax rules. Moreover, it promote transparent taxation practices for businesses and corporations operating within the country.