Minimizing Tax Risks: UAE Corporate Tax Penalty Strategies
In the realm of corporate taxation in the UAE, understanding the potential penalties is crucial for businesses.
Below table provides a clear overview of the penalties as per cabinet decision no. (75) Issued by ministry of finance related to UAE corporate tax.
By presenting this information simply, we aim to help businesses navigate tax regulations, make informed decisions, and avoid potential issues.
| Si. No | Description of Violation | Administrative Penalty Amount in AED |
| 1 | Failure of person to keep the required records and other information | AED 10,000 for first time AED 20,000 of repeated violation within 24 months from the date of the last violation. |
| 2 | Failure of the Registrant to submit a deregistration application within the timeframe | AED 1,000 in case of late submission of the application and on the same date monthly, up to a maximum of AED 10,000. |
| 3 | Failure of the Registrant to inform the Authority of any case that may require the amendment of the information pertaining to his Tax record kept by the Authority. | AED 1,000 for the first time. AED 5,000 of repeated violation within 24 months from the date of the last violation. |
| 4 | Failure of the Registrant to submit a Tax Return within the timeframe specified in the Corporate Tax Law. | 1. AED 500 for each month, or part thereof, for the first twelve months. 2. AED 1,000 for each month, or part thereof, from the thirteenth month onwards. This penalty shall be imposed from the day following the expiry date of the timeframe within which the Tax Return must be submitted, and on the same date monthly thereafter. |
| 5 | Failure of the Taxable Person to settle the Payable Tax. | A monthly penalty of 14% per annum, for each month or part thereof, on the unsettled Payable Tax amount from the day following the due date of payment and on the same date monthly thereafter |
| 6 | The Registrant submits an incorrect Tax Return. | AED 500, unless the Person corrects his Tax Return before the expiry of the deadline for the submission |
To learn more about Administrative Penalties for Violations Related to UAE Corporate Tax, book a free consultation with one of the Flyingcolour team advisors.
Disclaimer: The information provided in this blog is based on our understanding of current tax laws and regulations. It is intended for general informational purposes only and does not constitute professional tax advice, consultation, or representation. The author and publisher are not responsible for any errors or omissions, or for any actions taken based on the information contained in this blog.