The implementation of corporate taxation in the UAE complies with international standards to guarantee a transparent income taxation process. Under the corporate tax framework, failure to meet tax filing deadlines results in escalating fines for businesses.
These penalties were introduced by the UAE Ministry of Finance under Cabinet Decision No. 75 of 2023, effective 1 August 2023. The decision established administrative fines for violations of Federal Decree-Law No. 47 of 2022 on corporate taxation.
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UAE Announces Penalty for Late Registration for Corporate Tax
On 1 March 2024, the UAE Ministry of Finance introduced an AED 10,000 penalty for late corporate tax registration. Announced on 27 February 2024, this measure was designed to ensure timely compliance with the nation’s tax regulations. Corporate firms need to be aware of this and take action early to avoid the fine.
A taxable person who fails to keep proper records as required by the Corporate Tax Law faces a penalty of AED 10,000. If a second offense occurs within 24 months of the first, the penalty increases to AED 20,000.
This highlights the importance of compliance with corporate tax documentation standards. Unsure if your records meet FTA requirements? Our corporate tax experts can review your compliance status and help you avoid penalties.
The fine is meant to incentivize taxpayers to comply with the tax code and register on time. The fine amount for late registration for VAT and excise tax is the same.
UAE Corporate Tax Violations and Penalties
Maintaining Records and Submitting Information
Penalties for failing to keep required documents and data:
- The penalty for breaching record-keeping requirements is AED 10,000 for each violation.
- If the violation is repeated within 24 months, the penalty increases to AED 20,000.
A penalty of AED 500 per month applies for late submission of the Declaration to the Authority for the first twelve months. After this period, the penalty increases to AED 1,000 per month or part thereof. Businesses must ensure timely Declaration submissions to avoid these penalties.
Document Submission in Arabic
- AED 5,000 applies if necessary documentation is not provided in Arabic upon request.
Application for Closing Your Account
- Penalties apply if a closing application is not submitted within the allotted time.
- This penalty is AED 1,000 for each month of delay, up to a maximum of AED 10,000.
Modification of Tax Documents
- Every time a tax record modification is required, the Authority must be notified, or a penalty of AED 1,000 applies.
- A repeat infraction within 24 months carries a penalty of AED 5,000.
Notifying Legal Representatives and Filing Tax Returns
Penalties applied to legal representatives:
- Penalties apply to legal representatives who do not notify their appointment or file tax returns within the allotted time.
- The initial fine is AED 500 for each month during the first twelve months.
- After the thirteenth month, the penalty rises to AED 1,000 per month.
Resolving Accountable Tax
- For unpaid tax, a 14% annual penalty is charged monthly, starting the day after the payment due date. A Voluntary Disclosure must be submitted within 20 business days of discovering an error. It carries a 1% monthly penalty on the tax difference, calculated from the original due date, not from the date of disclosure. If the FTA identifies the error first, a fixed 15% penalty applies in addition to the 1% monthly charge.
Violations and Penalties for UAE Corporate Tax
Federal Decree-Law No. 47 of 2022, the Corporate Tax Law, and its revisions under Cabinet Decision No. 10 of 2024, are listed in the table below along with the corresponding penalties.
Based on infractions of the Corporate Tax Law and the Tax Procedures Law, the fines are determined by Cabinet Decision No. 75 of 2023, as restructured by Cabinet Decision No. 129 of 2025, effective 14 April 2026.
| No. | Violation Description | Administrative Fine/Penalty in AED |
| 1 | If businesses fail to keep records and necessary information as per the Corporate Tax and Tax Procedures Law, they may face a penalty of AED 10,000 per violation and AED 20,000 for repeat offenses within 24 months. | AED 10,000 per violation, AED 20,000 for repeat offenses within 24 months. |
| 2 | Not providing information, records, and paperwork in Arabic as requested by the Authority. | AED 5,000 |
| 3 | Failure to submit the closing application by the deadline. | AED 1,000 each month, up to AED 10,000 |
| 4 | Failure to notify the Authority of any case necessitating updating tax records. | AED 1,000 per infraction; AED 5,000 for repeat infractions within 24 months |
| 5 | The Legal Representative’s failure to announce their appointment. | AED 1,000 (from the personal funds of the Legal Representative) |
| 6 | The Legal Representative’s failure to timely file a tax return. | AED 500 per month for the first 12 months, AED 1,000 per month after (from the funds of the Legal Representative) |
| 7 | Failure to file a tax return on time. | AED 500 for each of the first 12 months, AED 1,000 per month after the 13th month |
| 8 | Not paying the payable tax. | 14% per annum, calculated monthly on the outstanding tax, beginning the day after the payment deadline |
| 9 | Filing an inaccurate tax return. | AED 500, if not corrected before the deadline |
| 10 | Filing a Voluntary Disclosure for an error in a tax return, tax assessment, or refund application. | 1% monthly penalty on the tax difference, calculated from the original due date |
| 11 | Failure to submit a Voluntary Disclosure before an FTA audit identifies the error. |
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| 12 | Not providing the Tax Auditor with facilitation. | AED 20,000 (from the Person, Legal Representative, or Tax Agent, as applicable) |
| 13 | Not submitting, or incorrectly submitting, a Declaration. | AED 500 for each of the first 12 months, AED 1,000 per month from the 13th month |
| 14 | Not submitting the corporate tax registration application by the deadline. | AED 10,000 |
💡 Concerned about any of the penalties listed above?
Even small compliance gaps can trigger FTA fines. Our consultants help businesses identify risks early.
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