UAE VAT Penalties
Administrative penalties for VAT non-compliance.
UAE VAT PENALTY REVISION – OLD vs NEW (Effective 14 April 2026)
No. | Violation | Before 14 Apr 2026 | From 14 Apr 2026 (Latest) |
|---|---|---|---|
1 | Failure to maintain records | AED 10,000 (first) | AED 10,000 per violation |
2 | Failure to provide Arabic records | AED 20,000 | AED 5,000 |
3 | Failure to update tax records | AED 5,000 (first) | AED 1,000 per violation |
4 | Failure to notify legal representative | AED 10,000 | AED 1,000 |
5 | Late payment of VAT | 2% immediately | 14% per annum (monthly on unpaid tax) |
6 | Incorrect tax return | AED 1,000 (first) | AED 500 |
7 | Voluntary Disclosure (VD) | 5% – 40% based on delay | 1% monthly on tax difference |
8 | No VD before audit | 50% penalty + 4% monthly | 15% fixed + 1% monthly |
9 | Failure to account tax (on behalf of another) | 2% + 4% monthly | 14% per annum (monthly basis) |
10 | Late VAT registration | AED 10,000 | AED 10,000 (unchanged) |
11 | Late VAT deregistration | AED 1,000 monthly (max AED 10,000) | AED 1,000 monthly (max AED 10,000) |
12 | Late tax return filing | AED 1,000 (first) | AED 1,000 (first) |
Additional VAT-Specific Penalties
Violation | Penalty |
|---|---|
Failure to display VAT-inclusive prices | AED 5,000 |
Failure to notify margin scheme | AED 2,500 |
Designated zone violations | Higher of AED 50,000 or 50% of tax |
Failure to issue tax invoice | AED 2,500 per case |
Failure to issue tax credit note | AED 2,500 per case |
Non-compliance with e-invoicing | AED 2,500 per case |
