Every penalty amount, every deadline, and every way to avoid them. This is the reference guide for UAE Corporate Tax compliance.
UAE Corporate Tax penalties are set by Cabinet Decision No. 75 of 2023 on Administrative Penalties for Violations Related to the Application of Federal Decree-Law No. 47 of 2022 on Taxation of Corporations and Businesses. The Federal Tax Authority (FTA) imposes these penalties automatically through the EmaraTax portal — there is no warning letter or grace period for most violations. Penalties cover late registration, late filing, late payment, failure to maintain records, and submission of incorrect returns. The penalty regime is separate from VAT penalties (governed by Cabinet Decision No. 49 of 2021) and ESR penalties (governed by Cabinet Decision No. 57 of 2020). TruAccountants manages Corporate Tax compliance end-to-end — registration, return preparation, and filing — to ensure no penalties are triggered. The service is included in all tiers starting from AED 1,500 per month.
| Violation | Penalty | Notes |
|---|---|---|
| Late tax registration | AED 10,000 | Applies to all taxable persons who fail to register by the deadline set by the FTA |
| Late deregistration | AED 10,000 | Applies when a taxable person ceases to exist but fails to deregister within the required timeframe |
| Late filing of tax return | AED 500 per month (or part month), max AED 12,000 | Tax return due within 9 months of financial year-end |
| Late payment of tax | 14% per annum on the unpaid tax, calculated monthly from the due date | Payment due on the same date as the tax return filing deadline |
| Failure to maintain records | AED 10,000 (first violation), AED 20,000 (repeat within 24 months) | Records must be maintained for 7 years from the end of the relevant tax period |
| Failure to submit data/documents requested by FTA | AED 5,000 | When the FTA requests information during an audit or review |
| Incorrect tax return (voluntary disclosure before FTA audit) | Fixed penalties of AED 500–AED 2,500 depending on timing relative to original deadline | Reduced penalties for voluntary correction before the FTA identifies the error |
| Incorrect tax return (discovered by FTA) | Underpaid tax + late payment interest from the original due date | The FTA may also impose additional penalties for negligence or deliberate underpayment |
| Tax evasion | Criminal penalties — up to 3x the evaded tax amount, plus potential imprisonment | Deliberate fraud, falsification of records, or concealment of taxable income |
| Failure to maintain transfer pricing documentation | AED 500,000 | For businesses with related-party transactions that fail to prepare required TP documentation |
The FTA has published specific deadlines based on entity type and licence issuance date. All UAE businesses — regardless of revenue — must register and obtain a Tax Registration Number (TRN). There is no minimum revenue threshold for registration.
Due within 9 months of the end of the tax period. For a standard December year-end: 30 September. For a June year-end: 31 March. The penalty is per month or part of a month — filing one day late triggers the first AED 500.
Payment is due on the same date as the return filing deadline. Interest accrues from the due date, calculated monthly. There is no instalment payment option — the full tax liability must be paid in one lump sum by the deadline.
VAT penalties are governed by a separate regime but are equally important:
| Violation | Penalty |
|---|---|
| Late VAT registration | AED 10,000 |
| Late VAT return filing | AED 1,000 (first offence), AED 2,000 (repeat within 24 months) |
| Late VAT payment | 2% immediately + 4% on the 7th day + 1% daily (max 300%) |
| Incorrect VAT return | AED 1,000 (first), AED 2,000 (repeat within 24 months) for voluntary disclosure |
| Failure to issue tax invoice | AED 5,000 per invoice (first), AED 10,000 (repeat) |
If you haven't registered yet or have a deadline approaching, talk to us now. Prevention costs a fraction of the penalty.
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