UAE Announces New Penalties for Corporate Tax Violations
Brace yourselves for a significant shift in the UAE’s corporate tax landscape, as Cabinet Decision No (75) of 2023 takes center stage. Starting from August 1, this dynamic decision will wield penalties for taxable entities found non-compliant with the UAE’s corporate tax law.
Championed by the UAE Ministry of Finance (MoF), this game-changing move encapsulated in Cabinet Decision No (75) of 2023 addresses administrative penalties for violations linked to the Federal Decree-Law No 47 of 2022, a decree that set the tone for the taxation of corporations and businesses.
Venturing into uncharted territory, the cabinet’s decision etches out the precise administrative penalties that the Federal Tax Authority will wield against infringements concerning the corporate tax law’s application. Effective from August 1, these penalties aren’t just heavy-handed measures but carefully crafted instruments, ensuring the corporate tax law’s seamless implementation and fostering compliance among businesses in the UAE.
Younis Haji Al Khoori, the Under-Secretary of the Ministry of Finance, underlined the essence of corporate tax compliance, emphasizing its pivotal role in nurturing the UAE’s economic growth. “It’s a shared responsibility,” he stated, “that upholds the UAE’s commitment to the highest global standards and creates a legislative ecosystem that thrives on tax compliance, ultimately boosting the nation’s sustainable economic growth.”
So, what does this mean for businesses? Penalties will bear down on both individuals and legal entities that fall short of fulfilling their obligations under the UAE’s corporate tax law. The list of possible violations is extensive, encompassing failure to timely file and pay corporate tax, as well as neglecting to notify the Federal Tax Authority about any crucial changes in tax-related information.
But that’s not all – a revamped structure for voluntary disclosure penalties makes an entrance, offering a chance for voluntary compliance rectification.
This comprehensive penalty framework extends its reach to instances of improper record keeping, the submission of requisite records and other stipulated information as mandated by the tax law. As the UAE navigates this bold financial frontier, businesses are called to heed the importance of adherence, as these penalties are a cornerstone of the nation’s continued economic prosperity.