TAX PENALTIES · LATE FILING · UAE

What Is the Penalty for Late Filing in the UAE?

Corporate Tax and VAT late filing and late payment penalties, how they add up, and how to avoid them

Missing a tax filing deadline in the UAE can be expensive. The Federal Tax Authority charges administrative penalties for late returns and late payments, and these can grow every month the filing remains outstanding.

The penalty depends on which tax you file: Corporate Tax, VAT, or excise. Each has its own filing and payment rules, and filing late and paying late are treated separately. The amounts have also been amended before, so always check the latest position.

This guide summarises the penalties reported for Corporate Tax and VAT, shows how costs build up, and explains how to avoid late filing and what to do if you have already missed a deadline. Our tax services team helps UAE businesses stay compliant and filed on time.

1. Penalties at a Glance

The UAE Federal Tax Authority (FTA) charges administrative penalties when returns are filed or taxes paid late. The penalty depends on the tax type, how late you are, and whether it is a repeat. Filing late and paying late are separate penalties, so you can face both.

Tax	Late filing	Late payment
Corporate Tax return	AED 500 per month for the first 12 months of delay, then AED 1,000 per month from the 13th month	Additional penalty on unpaid tax; confirm the current rate
VAT return	Fixed penalty for a late return, higher for repeat offences within a set period	2% of unpaid tax immediately, then 4% per month after one calendar month, capped at 300%
Excise tax	Fixed penalties for late returns	Percentage-based penalties on unpaid tax
Registration	Fixed penalty for late registration	Not applicable

2. Corporate Tax Late Filing

• Corporate Tax returns and payment are generally due within nine months of the end of the tax period or financial year
• Reported late filing penalty: AED 500 per month for the first 12 months of delay
• From the 13th month onwards: AED 1,000 per month
• Late registration, inaccurate information, and missing records can attract separate penalties
• Not sure the tax applies to you? Read who is required to pay Corporate Tax in the UAE

Accurate returns depend on correct deductions, so see what expenses are deductible for Corporate Tax. Our tax services team prepares and files returns on time.

3. VAT Late Filing and Late Payment

Situation	General penalty
Late VAT return	Fixed penalty, with a higher amount for repeated late returns within a set period
Late payment: day after the due date	2% of the unpaid tax
Late payment: one calendar month after the due date	Further 4% per month on the unpaid amount
Maximum for late payment	Capped at 300% of the unpaid tax
Incorrect return	Separate penalties; a voluntary disclosure can help correct errors

Reviewing your return before filing helps avoid errors; see our VAT compliance audit services. For sector examples, see restaurant chain VAT implementation.

4. Other Late Filing Penalties to Know

• Excise tax: late returns and payments attract their own penalties
• Late registration: failing to register for Corporate Tax or VAT on time can carry a fixed penalty
• Transfer pricing documentation and disclosures: missing or late items can be penalised; see multinational company transfer pricing
• Record-keeping: failure to keep or provide required records can carry penalties
• Audited financial statements and regulatory reports: some regulators have their own late filing rules; see how to comply with Central Bank requirements
• Fund and investment vehicles: reporting and tax deadlines also matter; see investment fund accounting UAE

5. Illustrative Cost of Delay

6. How to Avoid Late Filing

• Keep your documents organised; see documents needed for accounting services
• Set internal deadlines a week or more before the FTA deadline
• Assign a named person responsible for each filing
• Keep EmaraTax contact details and access up to date

7. What to Do If You Have Already Missed a Deadline

• File as soon as you can: penalties often grow with time
• Pay the tax due to stop late payment penalties building up
• If an earlier return was wrong, consider a voluntary disclosure
• Ask about whether a penalty can be reviewed or reconsidered where there are valid grounds
• Get professional help if several periods are overdue

An independent check such as a Corporate Tax compliance audit can identify exposure before it grows.

8. Build a Filing Calendar

Item	Typical frequency	Owner
VAT return and payment	As assigned by the FTA, often monthly or quarterly	Finance or outsourced accountant
Corporate Tax return and payment	Annually, per the tax period	Finance and tax adviser
Excise returns (if applicable)	Monthly	Finance
Audited financial statements (if required)	Annually	Finance and auditor
Licence and registration renewals	Annually	Admin or PRO

Combining filings in one calendar is easier when one team handles them; see our advisory services and audit and assurance services.

9. Common Mistakes

• Assuming that a nil or low-activity period needs no return
• Filing on time but paying late, or the other way round
• Waiting for audited accounts before starting tax preparation
• Missing the FTA notices sent to an old email or phone number
• Not updating deadlines after a change in financial year or VAT period
• Relying on out-of-date penalty information

Frequently Asked Questions