UAE Tax Penalties in 2026: Late Registration, Filing and Payment Explained

The administrative penalties junior tax staff meet most, from the VAT and Excise table as amended from 14 April 2026 and the Corporate Tax table: late registration, late returns, the 14% late-payment rule, Voluntary Disclosures and records.

The UAE’s administrative penalties sit in Cabinet Decisions issued under the Tax Procedures Law. For VAT and Excise Tax the table is Cabinet Decision No. 40 of 2017, as amended by Cabinet Decision No. 129 of 2025, in force from 14 April 2026. For Corporate Tax it is Cabinet Decision No. 75 of 2023. Amounts are revised from time to time, so check tax.gov.ae before quoting a figure to a real client.

Registering late

• VAT or Excise Tax registration not applied for on time: AED 10,000.
• Corporate Tax registration not applied for on time: AED 10,000. The FTA waives or refunds it if the first Corporate Tax return is filed within 7 months of the end of the first tax period.
• Deregistration applied for late: AED 1,000, plus AED 1,000 each further month, up to AED 10,000.

Filing late

• VAT or Excise return: AED 1,000 the first time, AED 2,000 if repeated within 24 months.
• Corporate Tax return: AED 500 for each month (or part of a month) for the first 12 months, then AED 1,000 a month.

Example: a Corporate Tax return filed 15 months late costs 12 × AED 500 plus 3 × AED 1,000 = AED 9,000.

Paying late: the 14% rule

Tax not paid on time is charged a monthly penalty at 14% a year on the unpaid amount, for each month or part of a month, from the day after the due date. This applies to VAT, Excise Tax and Corporate Tax. Tax shown on a Voluntary Disclosure is due 20 business days after it is submitted, and tax on an FTA assessment 20 business days after it is received.

Filing and paying are separate: a return filed on time but paid late still attracts the late-payment penalty.

Errors and Voluntary Disclosures

• An incorrect return: AED 500, unless it is corrected before the return’s deadline.
• A Voluntary Disclosure: a monthly 1% of the tax difference, from the return’s due date until the disclosure is made.
• If the error is only disclosed after the FTA notifies a tax audit, or not disclosed at all: a fixed 15% of the difference on top of the monthly 1%.

Records and other duties

• Not keeping the required records: AED 10,000, or AED 20,000 for a repeat within 24 months.
• Not providing records in Arabic when asked: AED 5,000.
• Not telling the FTA about a change to registration details: AED 1,000, or AED 5,000 for a repeat within 24 months.
• VAT only: not issuing a tax invoice or tax credit note on time, AED 2,500 for each case; not displaying prices inclusive of VAT, AED 5,000.
• Not cooperating with an FTA tax auditor: AED 20,000.

Frequently asked questions

Is the late-payment penalty compound? It is a monthly penalty at 14% a year on the unpaid tax.

Does a zero return still need filing on time? Yes. Late-filing penalties apply even when little or no tax is due.

Is it better to disclose an error early? Yes. Disclosing before an audit notice avoids the fixed 15%.

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