Federal Tax Authority reminds taxpayers to benefit from administrative penalty re-determination facility before deadline on December 31

• The procedure allows taxpayers to re-determine administrative penalties on tax violations to be 30% of total outstanding amount.

Abu Dhabi, UAE - 22 December 2022 – The Federal Tax Authority (FTA) is calling on registered taxpayers to benefit from the facility to re-determine administrative penalties on tax violations to be 30% of the total outstanding amount of administrative penalties that were not paid before 28 June 2021

The FTA stressed that the facility has a set deadline and that taxpayers who are eligible to benefit from the Decision must complete all related procedures through the EmaraTax portal before 31 December 2022 to be able to benefit from these facilities.

In a press statement issued today, the Authority explained that after 31 December 2022, tax registrants who have outstanding administrative penalties from before 28 June 2021 will not be eligible to avail the re-determination facility and will be required to pay their penalties in total, instead of just 30% of them, if met the required conditions within the deadline set by the Cabinet Decision on Re-Determining Administrative Penalties on Tax Violations in the UAE.

The Decision outlined three conditions that need to be met in order to benefit from the re-determination of administrative penalties imposed before 28 June 2021. First, the administrative penalty must be imposed under Cabinet Decision No. (40) of 2017 before 28 June 2021 and remain outstanding. Second, the tax registrant needs to have settled all due Payable Tax by 31 December 2022 with no remaining outstanding taxes by end of 2022. And third, the tax registrant must have paid 30% of the total unsettled administrative penalties imposed before 28 June 2021 no later than 31 December 2022.

Registrants can visit their Amnesty Dashboard on their EmaraTax accounts and follow the process to make the payment. Upon going to the payments screen on EmaraTax, registrants may select Administrative Penalties unpaid before the date of June 28, 2021. Registrants may either pay 30% for each of the Administrative Penalty line item or select such line items (either full or partial) that equate to 30% of such unpaid Administrative Penalties. Where the required conditions are met, the new value of the penalties will be equal to 30% of the total unpaid penalties, which will appear on the registrant’s account on the EmaraTax portal after 31 December 2022.

The Federal Tax Authority indicated that the Cabinet Decision aims to support registrants in the tax system to fulfil their tax obligations, providing a great opportunity to assist businesses in re-determining administrative penalties to be equal to 30% of total unpaid fines, according to the conditions set in the Decision.