Blood money was in the headlines this week when the Ruler of Sharjah promised to pay Dh200,000 ($54,458) for the release of a woman from prison.
The woman was jailed when one of her employees died after being electrocuted.
She was ordered to pay the maximum blood money amount – Dh200,000 – to the family of the worker.
A leading lawyer in the UAE told The National that blood money payments were common in the region.
“Blood money payments come into effect when you are found responsible for causing someone’s death,” said Hassan Elhais, legal consultant at Al Rowaad law firm.
“It’s most commonly applied in traffic accidents that result in somebody being killed.
“The amount could be reduced if there were mitigating circumstances, like the victim was on the wrong side of the road or they didn’t stop at a red light, for example.”
He said the amount is typically paid to the heirs of the deceased but this did not prevent them from seeking further compensation.
“The courts can also decide to award further payments to the family of the victim based on loss of income,” he said.
“This only happens in rare cases but the court would take into account the age and profile of the deceased.
“Further compensation, which is separate from blood money, could be related to the loss of earnings the family might have to endure by the death of their loved one.”
The week, the husband of the Emirati woman ordered to pay Dh200,000 in blood money contacted a local radio station to plead his case.
He said he could not afford to make the payment, which meant his wife would have to stay in prison.
Sheikh Dr Sultan bin Muhammad Al Qasimi, Ruler of Sharjah and a regular listener to the live radio programme Al Khat Al Mubasher (The Direct Line), heard about the family’s situation and offered to pay the amount to release the woman.
But the payment of blood money, or diya as it is also known, does not always mean someone will avoid a prison term for causing the accidental death of another, Mr Elhais said.
“They can often be two different rulings, it’s at the discretion of the court to decide on that,” he said.
Mr Elhais also said families appealing for blood money must do so within a certain timeframe.
“There is a statute of limitations – you must claim blood money within three years,” he said.
Ten tax points to be aware of in 2026
1. Domestic VAT refund amendments: request your refund within five years
If a business does not apply for the refund on time, they lose their credit.
2. E-invoicing in the UAE
Businesses should continue preparing for the implementation of e-invoicing in the UAE, with 2026 a preparation and transition period ahead of phased mandatory adoption.
3. More tax audits
Tax authorities are increasingly using data already available across multiple filings to identify audit risks.
4. More beneficial VAT and excise tax penalty regime
Tax disputes are expected to become more frequent and more structured, with clearer administrative objection and appeal processes. The UAE has adopted a new penalty regime for VAT and excise disputes, which now mirrors the penalty regime for corporate tax.
5. Greater emphasis on statutory audit
There is a greater need for the accuracy of financial statements. The International Financial Reporting Standards standards need to be strictly adhered to and, as a result, the quality of the audits will need to increase.
6. Further transfer pricing enforcement
Transfer pricing enforcement, which refers to the practice of establishing prices for internal transactions between related entities, is expected to broaden in scope. The UAE will shortly open the possibility to negotiate advance pricing agreements, or essentially rulings for transfer pricing purposes.
7. Limited time periods for audits
Recent amendments also introduce a default five-year limitation period for tax audits and assessments, subject to specific statutory exceptions. While the standard audit and assessment period is five years, this may be extended to up to 15 years in cases involving fraud or tax evasion.
8. Pillar 2 implementation
Many multinational groups will begin to feel the practical effect of the Domestic Minimum Top-Up Tax (DMTT), the UAE's implementation of the OECD’s global minimum tax under Pillar 2. While the rules apply for financial years starting on or after January 1, 2025, it is 2026 that marks the transition to an operational phase.
9. Reduced compliance obligations for imported goods and services
Businesses that apply the reverse-charge mechanism for VAT purposes in the UAE may benefit from reduced compliance obligations.
10. Substance and CbC reporting focus
Tax authorities are expected to continue strengthening the enforcement of economic substance and Country-by-Country (CbC) reporting frameworks. In the UAE, these regimes are increasingly being used as risk-assessment tools, providing tax authorities with a comprehensive view of multinational groups’ global footprints and enabling them to assess whether profits are aligned with real economic activity.
Contributed by Thomas Vanhee and Hend Rashwan, Aurifer
