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Penalty for Late Corporate Tax Registration in UAE
On February 27, 2024, the Ministry of Finance announced an AED10,000 penalty for late registration of UAE Corporate Tax. Businesses failing to submit their Corporate Tax registration on time, as specified by the Federal Tax Authority, will face this penalty. The aim of this penalty is to promote compliance with tax laws, urging taxpayers to register for corporate tax promptly. The penalty amount for delayed tax registration mirrors the penalties for late registration of excise tax and value-added tax. This measure underscores the government’s commitment to ensuring timely tax compliance and fostering a culture of adherence to tax regulations among businesses in the UAE.
What is the purpose of AED10,000 penalty for late corporate tax registration in UAE? The purpose of AED10,000 penalty for late corporate tax registration in UAE is to encourage taxpayers to comply with tax regulations and register for corporate tax timely.
Administrative Penalties for Corporate Tax Violations:
| Violation | Penalty (AED) |
| Failure to keep required records and information | 10,000 for each violation. 20,000 for repeated violations within 24 months |
| Failure to submit records and documents in Arabic when requested | 5,000 |
| Late submission of deregistration application | Apply late, you’ll pay 1,000. Then, every month on that same date, you’ll pay 1,000 until you reach a maximum of 10,000 |
| Failure to inform FTA of changes to tax record information | 1,000 per violation 5,000 for repeated violations within 24 months |
| Failure to Notify Appointment Within Timeframes | 1,000 |
| Failure to File Tax Return Within Specified Timeframes | 500 for each complete month or any part thereof, applicable for the initial twelve months. 1,000 for each complete month or any part thereof, effective from the thirteenth month onward. |
| Failure to Submit Corporate Tax Return within Specified Timeframe | 500 for each month, or part thereof, for the first twelve months. 1,000 for each month, or part thereof, from the thirteenth month onwards. |
| Failure to settle payable tax | 14% annual penalty per month on unsettled amount |
| Registrant submits an incorrect Tax Return | 500 penalty unless the person corrects their tax return before the deadline according to Corporate Tax Law |
| Penalty for Late Submission of Voluntary Disclosure under Tax Procedures Law | Monthly penalty of 1% on Tax Difference until submission |
| Failure to submit voluntary disclosure before tax audit notification | 15% fixed penalty on tax difference, 1% monthly penalty |
| Failure to facilitate tax audit | 20,000 penalty from taxable person, representative or agent |
How Can ADEPTS Help?
ADEPTS play an important role in helping businesses prevent penalties for late corporate tax registration. Here’s how they can assist:
Timely Compliance Reminders: Provide clients with timely reminders for tax registration deadlines, ensuring prompt submission of necessary documents.
Expert Guidance on Requirements: Offer expert guidance for UAE corporate tax registration, aiding clients in understanding requirements and procedures.
Assistance with Documentation: Streamlines tax registration by preparing and organizing documentation, minimizing errors and delays.
Submission Support: Ensure clients’ timely and accurate submission of registration documents for a smooth process.
Monitoring Regulatory Changes: Updated tax regulations, informing clients promptly of any changes that may impact their tax registration status.
Regular Compliance Reviews: Regularly review client compliance to ensure they meet tax obligations, avoiding late registration and penalties.
