FTA sets deadline to apply for re-determination of administrative penalties on taxes

Eligible taxpayers must complete all related procedures through the e-services portal on the official website before December 31

Eligible taxpayers can apply to have their penalties re-determined to be worth 30 per cent of the total outstanding amount. Silvia Razgova / The National

The UAE's Federal Tax Authority (FTA) urged eligible registered taxpayers to apply for the re-determination of administrative penalties on taxes prior to the December 31 deadline.

Eligible taxpayers can apply to have their penalties re-determined to be worth 30 per cent of the total outstanding amount of penalties that were not paid before June 28, 2021, the FTA said in a statement on Sunday.

These taxpayers must ensure they meet the conditions set out in the UAE Cabinet's decision on re-determining administrative penalties imposed on tax law violations in the UAE, the authority said.

They must also complete all related procedures through the e-services portal on the FTA's official website before December 31 to be able to benefit from these facilities.

“According to the relevant Cabinet decision, which went into effect on January 1, 2022, tax registrants who were unable to meet the criteria for benefiting from the re-determination by December 21, 2021 will be able to apply for re-determining administrative penalties to be equal to 30 per cent of the total outstanding fines by fulfilling the necessary conditions no later than December 31, 2022,” the FTA said.

Set up in 2016 to help the UAE diversify the national economy and increase non-oil revenue through the management and collection of federal taxes, the FTA has consistently improved its services to streamline the taxation process.

In October, the FTA said it plans to launch a new integrated platform this year to further digitalise tax administration as part of the national digital agenda.

In September, the UAE also introduced a paperless tax refund system for tourists visiting the country, doing away with the need to retain receipts.

In terms of the December deadline, the authority clarified that the decision outlined three conditions that need to be met to benefit from the re-determination of administrative penalties imposed before June 28, 2021.

First, the administrative penalty must be imposed under Cabinet decision No. (40) of 2017 before June 28, 2021, and remain outstanding.

Second, the tax registrant needs to have settled all due payable tax by December 31, 2021.

Finally, the tax registrant must have paid 30 per cent of the total unsettled administrative penalties due until June 28, 2021 no later than December 31.

The authority said that if the registrant meets all conditions, the new value of the penalties will be equal to 30 per cent of the total unpaid penalties, which will appear on the registrant’s account in the FTA’s e-services system after December 31.

Taxpayers must pay their due payable tax before the due date to avoid any late payment penalties, it added.

The authority noted that bank transfers can take up to three working days to process the payment, which applicants must take into consideration to ensure that FTA receives the payment before the due date.