Waiver of Penalty for late submission of Corporate Tax Registration application

Waiver of Penalty for late submission of Corporate Tax Registration application

The Ministry of Finance (‘MOF’) and Federal Tax Authority (‘FTA’) have announced issuance of a Cabinet Decision on an initiative for waiver of penalties levied by FTA on account of late submission of application for Corporate Tax Registration.

Who Will Benefit?

All taxable persons under the UAE Corporate Tax Law, including certain categories of Exempt Persons that are required to file an annual declaration, that missed the deadline to submit the Corporate Tax Registration application due to which penalty of AED 10,000 is levied.

Conditions to avail the penalty waiver

• The Corporate Tax Return or the annual declaration as applicable must be submitted within 7 months from the end of the tax period by complying with all provisions under the Corporate Tax Law (as against the standard time line of submitting Corporate Tax Return within 9 months from the end of the tax period).
• The public clarification issued has clarified that the aforesaid time limit is only to file the Tax Returns while the payment of taxes, if any, can be done as per the standard time line of 9 months from the end of the tax period.

Way Forward

It is recommended that taxpayers who wish to avail the penalty waiver should prepare to file the Corporate Tax Returns within the aforesaid timeline of 7 months from the end of the respective tax period to benefit from the penalty waiver. In case you require any assistance, please feel free to contact us.