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VAT Penalty Redetermination
The Federal Tax Authority encourages registrants to take advantage of penalty redetermination introduced by Cabinet Decision No. 49 of 2021, effective on 28th June 2021
Press
Release
United Arab Emirates - Abu
Dhabi:
The Federal Tax Authority has called on tax
registrants in the UAE to benefit from the penalty redetermination scheme
introduced by Cabinet Decision No. 49 of 2021 on Amending Some Provisions of
Cabinet Decision No. 40 of 2017 on the Administrative Penalties for Violation
of Tax Laws in the UAE, which will be effective from 28th June
2021.
In a press release
issued today, the Authority stressed the three conditions that must be met for tax registrants to benefit from the re-determination of unpaid
administrative penalties imposed before 28 June 2021, to equal 30% of the
total unpaid penalties.
The first condition is
that the administrative penalty must have been imposed under Cabinet Decision
No. 40 of 2017 before 28th June 2021, and some or all of it remains outstanding.
The second condition is that the tax
registrant settles all payable tax by 31st December 2021, so that there is no outstanding tax payable by the end of 2021. Finally,
the third condition requires tax registrants to settle 30% of any
administrative penalties payable and unsettled by 28th June 2021, on or before 31st December
2021.
His Excellency Khalid Ali Al-Bustani, Director-General of the Federal
Tax Authority, said: “To ensure a smooth, flexible, and accurate
implementation of the decision and to provide additional facilities for
registrants to benefit from the decision, the Authority will be launching a
dashboard for penalty redetermination, which can be accessed from the main
dashboard of the registrant on the FTA’s E-Services portal, which enables
registrants to check various data, including “Total Unpaid
Administrative Penalties imposed before 28th June 2021”; “Total
Unpaid Administrative Penalties reversed after 28th June 2021”
–an amount that may be related to penalties imposed before 28th June
2021, but the decision to reverse was taken after 28th June
2021; “Net Unpaid Administrative Penalties imposed before 28th
June 2021”
– The difference between the Total Unpaid Administrative Penalties
imposed before 28th June 2021 and Total Unpaid Administrative
Penalties reversed after 28th June 2021, which is subject to
redetermination if conditions are met; “Total Administrative Penalties
payable as per Cabinet Decision No. 49 of 2021” – The 30% share of
Total Unpaid Administrative Penalties imposed before 28th June 2021,
that needs to be settled before 31st December 2021 to benefit from the
redetermination; “Total Administrative Penalties paid after 28th
June 2021” – The number of administrative penalties imposed before 28th
June 2021 and considered to have been settled after 28th June
2021; “Outstanding Administrative Penalties payables as per Cabinet
Decision No. 49 of 2021”
– Amount of administrative penalties that are still expected to be
settled to benefit from the redetermination; “Tax Payable”
– Outstanding tax balance (based on tax returns submitted and any adjustments
due to voluntary disclosures or tax assessments) and will be updated daily until 31st December 2021, for registrants to know how much tax
is outstanding and is subject to late payment penalties if not settled by
payable date, and needs to be settled before 31st December 2021 to
benefit from the redetermination; “Net Outstanding to be paid as per
Cabinet Decision No. 49 of 2021” – Sum of Outstanding Administrative
Penalties payable and tax that have to be settled before 31st December
2021 to benefit from the redetermination. This may increase or
decrease until 31st December 2021 if and when your tax payable and
outstanding administrative penalties change.
Penalty Redetermination in Dubai
Penalty Redetermination in Sharjah
Penalty Redetermination in Ajman
Penalty Redetermination in Abu Dhabi
Penalty Redetermination in Fujairah