The Ministry of Finance in the UAE has announced new administrative penalties for non-compliance with taxation regulations applicable to corporations and businesses.

These penalties were implemented on August 1, 2023, as per Cabinet Decision No. 75 of 2023, addressing violations pursuant to Federal Decree-Law No. 47 of 2022 on the Taxation of Corporations and Businesses (“Corporate Tax Law”).

Corporate Tax Law aims to ensure effective enforcement and compliance without burdening companies and businesses. Careful consideration and comparison with best practices were undertaken while designing these penalties. Any taxable person, whether an individual carrying out taxable business or a legal entity, who fails to comply with the Corporate Tax Law in the UAE, will be subject to these penalties.

The penalties are imposed in circumstances such as failure to submit tax declarations or late payment of taxes, failure to maintain the records and information as required by the Corporate Tax Law, or failure to notify the Federal Tax Authority concerning any changes in their tax records.

Author: Abdulla Ziad Galadari