Administrative Penalties for Violations of Tax Laws in the UAE
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LIST OF PENALTIES UNDER UAE TAX LAWS
A comprehensive list of all Administrative Penalties for Violation of Tax Laws in the UAE is given .
1. VIOLATIONS RELATED TO TAX PROCEDURES
S.NO
SUBJECT WORD
VIOLATION OF TAX LAWS
PENALTIES (IN AED)
WILL BORNE BY
1 Record Keeping Failure to keep the required records specified by the tax procedures law and the tax law. - 10,000 for the first time
- 50,000 for each repeat violation
Registrant 2 Record submission in Arabic Failure to submit the required records in Arabic when requested by the Authority - 20,000
Registrant 3 Registration Failure to submit a registration application within the timeframe specified by the tax law. - 20,000
The person liable to be registered 4 Deregistration Failure to submit a deregistration application within the timeframe specified by the tax law. - 10,000
Registrant 5 Amendment to tax records Failure to inform the Authority of an amendment to tax records that need to be submitted - 5,000 for the first time.
- 15,000 in case of repetition.
Registrant 6 Appointment of legal representative Failure to notify the authority that a legal representative has been appointed for the business within the specified timeframe. - 20,000
Legal representative 7 Failure to file the tax return by legal representative Failure of the legal representative to file a tax return within the specified timeframe. - 1,000 for the first time.
- 2,000 in case of repetition within 24 months.
legal representative 8 Failure to File tax return by Registrant Failure of the Registrant to submit a tax return within the timeframe specified by the tax law. - 1,000 for the first time.
- 2,000 in case of repetition within 24 months
Registrant 9 Payment of tax Failure to pay the tax stated in the tax return/tax assessment form within the timeframe specified by the tax law. - The taxable person will incur a late payment penalty as follows
- 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% of payable tax.
Registrant 10 Submission of incorrect tax return The submission of incorrect tax returns by the Registrant. Two penalties are applied: 1- Fixed penalty
- 3,000 for the first time
- 5,000 in case of repetition
2– Percentage-based penalty
A percentage-based penalty shall be applied to the amount unpaid to the Authority due to the error and resulting to tax benefits as follows.- (50%) if the Registrant does not make a voluntary disclosure or he made the voluntary disclosure after being notified of the tax audit and the Authority has started the tax audit process, or after being asked for information relating to the tax audit, whichever takes place first.
- (30%) if the Registrant makes a voluntary disclosure after being notified of the tax audit and before the Authority starts the tax audit.
- (5%) if the Registrant makes a voluntary disclosure before being notified of the tax audit by the Authority.
Registrant 11 Disclosure of errors in a tax return, tax assessment, or refund application Voluntary disclosure by a business of errors in a VAT tax return, tax assessment, or refund application Two penalties are applied 1- Fixed penalty
- 3,000 for the first time
- 5,000 in case of repetition
2– Percentage-based penalty
A percentage-based penalty shall be applied to the amount unpaid to the Authority due to the error as follows.- (50%) if the person/taxpayer does not make the voluntary disclosure after being notified of the tax audit and the Authority has started the tax audit process, or after being asked for information relating to the tax audit, whichever takes place first.
- (30%) if the person/taxpayer makes the voluntary disclosure after being notified of the tax audit but before the Authority starts of the tax audit.
- (5%) if the person/taxpayer makes a voluntary disclosure before being notified of the tax audit by the Authority.
Taxpayer/person 12 Voluntarily disclose of errors before tax audit Failure of a business to voluntarily disclose errors in a tax return, tax assessment, or refund application before a tax audit. Two penalties are applied 1- Fixed penalty
- 3,000 for the first time
- 5,000 in case of repetition
2– Percentage-based penalty
50% of the amount unpaid to the Authority due to the error.Taxpayer/person 13 Failure to facilitate tax audit Failure of a person or business to facilitate the work of the tax auditor - 20,000
Taxpayer/person 14 The failure to calculate Tax on behalf of another Person Failure of the Registrant to calculate tax on behalf of another person as required under the tax law - 2% of the unpaid tax is due immediately once the payment is late.
- 4% of the amount of tax which is still unpaid 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%.
Registrant 15 Failure to account for tax on import of goods Failure to account for tax due on the import of goods as required under the tax law. - 50% of unpaid or undeclared tax
Registrant
2. VIOLATIONS RELATED TO VATS.NO SUBJECT WORD VIOLATION OF TAX LAWS
PENALTIES (IN AED) WILL BORNE BY 1 Prices inclusive of Tax Failure by the Taxable Person/business to display prices Inclusive of Tax. - 15,000
Taxable Person 2 Tax based on margin Failure by the Taxable Person/business to notify the Authority of applying Tax based on the margin. - 2,500
Taxable Person 3 Designated Zones Failure by the Taxable Person to provide the Authority with price lists for the Excise Goods produced, imported or sold thereby The penalty shall be the higher - 50,000
- or 50% of the tax, if any, unpaid on the goods as the result of the violation
Taxable Person 4 Tax invoices Failure by the taxable person/business to issue a tax invoice or alternative document when making any supply - 5,000 for each missing tax credit note or alternative document
Taxable Person 5 Electronic tax invoices Failure by the taxable person/business to comply with the conditions and procedures regarding the issuance of electronic tax invoices and electronic tax credit notes - 5,000 for each incorrect document
Taxable Person
3. VIOLATIONS RELATED TO EXCISE TAXS.NO SUBJECT WORD VIOLATION OF TAX LAWS
PENALTIES (IN AED) WILL BORNE BY 1 Prices Inclusive of Tax Failure by the Taxable Person/business to display prices Inclusive of Tax. - 15,000
Taxable Person 2 Designated Zones Failure to comply with the conditions and procedures related to transfer the Excise Goods from one Designated Zone to another Designated Zone, and the mechanism of processing and storing of such Excise Goods. The penalty shall be the higher - 50,000
- or 50% of the tax, if any, unpaid on the goods as the result of the violation
Taxable Person 3 Provision of price list for excise goods. Failure by the Taxable Person to provide the Authority with price lists for the Excise Goods produced, imported or sold thereby - 5,000 for the first time.
- 20,000 in case of repetition
Taxable Person Read more about VAT Registration Questions Answers