Revised FTA VAT fines and penalties in UAE
PREVIOUS PENALTY vs NEW PENALTY
1. Late VAT Registration penalty
- Previous penalty – AED 20,000
- New penalty – AED 10,000
2. Late VAT De-registration penalty
- Previous penalty – AED 10,000
- New penalty – AED 1,000 in case of delay, and on the same date monthly thereafter, up to a maximum of 10,000.
3. Late VAT return filing penalty
- Previous penalty – AED 1,000 for the first time and AED 2,000 in case of repetition within 24 months.
- New penalty – AED 1,000 for the first time and AED 2,000 in case of repetition within 24 months. (Not amended)
4. Late VAT payment penalty
Previous penalty –
- 2% of the unpaid tax is due immediately.
- 4% is due on the seventh day following the deadline for payment.
- 1% daily penalty will be charged on any amount that is still unpaid one calendar month after the deadline for payment, up to a maximum of 300%.
New penalty –
- 2% of the unpaid tax is due immediately.
- 4% monthly penalty is due after one month from the due date of payment, and on the same date monthly thereafter, on the unsettled Tax amount to date.
5. Submission of Incorrect tax return by the registrant
- Previous penalty – AED 3,000 for the first time and AED 5,000 in case of repetition.
- New penalty – AED 1,000 for the first time and AED 2,000 in case of repetition.
6. Failure of the business maintaining proper books of accounts (Accounting and Bookkeeping)
- Previous penalty – AED 10,000 for the first time and AED 50,000 in case of repetition.
- New penalty – AED 10,000 for the first time and AED 20,000 in case of repetition.
7. Failure in submitting the data, records and documents related to Tax in Arabic to Authority when requested
- Previous penalty – AED 20,000
- New penalty – AED 20,000 (Not change)
8. Failure to inform the Authority of any circumstance that requires the amendment of the information pertaining to its Tax record kept by Authority
- Previous penalty – AED 5,000 for the first time and AED 15,000 in case of repetition.
- New penalty – AED 5,000 for the first time and AED 10,000 in case of repetition.
9. Failure of the Legal Representative of the Taxable Person to inform the Authority of its appointment as Legal Representative within the specified timeframe, in which case the Penalties will be due from the Legal Representative’s own funds
- Previous penalty – AED 20,000
- New penalty – AED 10,000
10. Submission of a VAT Voluntary Disclosure by Taxpayer on mistakes in the Tax Return or refund application
- Previous penalty – AED 3,000 for the first time and AED 5,000 in case of repetition.
- New penalty – AED 1,000 for the first time and AED 2,000 in case of repetition.
11. Failure of the Person conducting Business to facilitate the work of the Tax Auditor
- Previous penalty – AED 20,000
- New penalty – AED 20,000 (No change)
12. Person not accounting for any Tax that may be due on the import of goods as per the Tax Law
- Previous penalty – 50% of unpaid or undeclared Tax
- New penalty – 50% of unpaid or undeclared Tax (No change)
13. Failure to show prices on tax invoice inclusive of tax.
- Previous penalty – AED 15,000
- New penalty – AED 15,000 (No change)
14. Failure to inform FTA of applying tax based on the margin.
- Previous penalty – AED 2,500
- New penalty – AED 2,500 (No change)
15. Failure to comply with conditions & procedures related to the transfer of goods in designated zones.
- The penalty will be the higher of AED 50,000 or 50% of the tax, if any, unpaid on the goods as the result of the violation. (No change)
16. Failure to issue a tax invoice or alternative document when making any supply.
- Previous penalty – AED 5,000 for each missing tax invoice or alternative document.
- New penalty – AED 5,000 for each missing tax invoice or alternative document. (No change)
17. Failure to issue a tax credit note or alternative document.
- Previous penalty – AED 5,000 for each missing tax credit note or alternative document.
- New penalty – AED 5,000 for each missing tax credit note or alternative document. (No change)
18. Failure to follow the conditions regarding the issuance of electronic tax invoices and tax credit notes.
- Previous penalty – AED 5,000 for each incorrect document.
- New penalty – AED 5,000 for each incorrect document. (No change)
View Comments
dear Sirs,
shrouq heavy equipment spare parts trading company there is no business transactions from last 3 years.
as the mail id is not functioning, we changed the mail ID to new one lalagy@gmail.com. i am not geting any updates or new password in this mail. so I was not in position to make the tax returns which was due 28-12-2022.
you are requested to extend my tax return period one more week so that I will file the same after returning from India.
you are requested to maintain my previous mail ID (lalagy@gmail.com ) for all my correspondence with FTA.
MY TRN NO- 100353893900003.
PLEASE DO NEEDFUL URGENT
Hi Thank you for your comment. One of our representatives will get in touch with you regarding your VAT concerns. Thank you
I have a grocery in Ras Al Khaimah. one yeaer before dubai tax authority given fine 65000. I don't know have a any change for reduce some fine
Is it a VAT fine or an Excise fine?
hello, during pandemic our business went down and had to close the entire business as within the company there are issues happened between shareholders. so businesses are made and last vat payment of 12500 aed was pending as at 2019 end. since all the emails, logins details are missed place, no one did the de registration of VAT, now after adding paneities it shows 66000aed total to pay. I need assistance whether can we waived off these paneities and pay only the 12500 . also can we arrange the installment plan for the same? please help
Hello, Thank you for your comment. Please share your inquiry to info@xactauditing.ae along with your contact details and one of our representatives will contact you to discuss regarding the VAT fines and penalties in UAE.
Hello, I would like to speak to someone regarding VAT filings and fines for a commercial real estate transaction. Seller was an individual and buyer was a company.
Hello Nate,
Thank you for your comment. One of our representatives will contact you shortly.
I would like to know the exact rule relating to Invoicing ( Delivery note to Invoice)
how man days we can hold the delivery Note without making Tax Invoice