Penalty for failure to file VAT return

FTA imposes an administrative penalty of AED 1,000 for the failure of the Registrant to submit the Tax Return within the timeframe specified in the Tax Law. If the failure is repeated with 24 months then the penalty of AED 2,000.

In case of failure to pay tax payable

The taxable person shall be obligated to pay a late payment penalty of:

Delay in daysPenalty
 1st to 6th day2 % of the unpaid tax amount
7th to one month4 % of the unpaid tax amount
After one calendar month1 % daily on the unpaid tax amount but maximum of 300%

Submission of incorrect tax return

A fixed penalty of AED 3000 for the first time and AED 5000 in case of repetition.

Percentage based penalty

  • 5% if registrant makes a voluntary disclosure before being notified of the tax audit
  • 30% if registrant makes disclosure after being notified of tax audit but before starting of audit
  • 50% if tax audit is started or registrant is asked for information relating to tax audit, whichever is earlier


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The entire contents of this article is solely for information purpose and have been prepared on the basis of relevant provisions and as per the information existing at the time of the preparation.. It doesn't constitute professional advice or a formal recommendation. The author has undertook utmost care to disseminate the true and correct view and doesn't accept liability for any errors or omissions. You are kindly requested to verify & confirm the updates from the genuine sources before acting on any of the information's provided herein above.

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