Compliance

What non-compliance actually costs in the UAE

8+Years in the UAE
Since 2017

Every figure against the decision that imposes it
Updated for the rules in force from 14 April 2026
VAT, corporate tax, ESR and e-invoicing in one place

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The short answer

Six numbers worth knowing before a deadline passes

The penalties for VAT, excise and tax procedures were rewritten on 14 April 2026. Figures published before that date, including on a good many UAE advisory sites, are out of date.

AED 10,000
Late corporate tax registration
AED 500 a month
Late corporate tax return
AED 1,000
Late VAT return
14% a year
Paying any tax late
AED 50,000
Missing the ESR report
AED 5,000 a month
Late e-invoicing rollout

In full

Every penalty, against the decision that imposes it

Choose a tax. Each figure carries the row or article it comes from, and each set carries the date those amounts took effect and a link to the published text.

Applies to every VAT and excise registrant under the Tax Procedures Law.

Imposed by: Cabinet Decision No. 40 of 2017, as amended by Cabinet Decision No. 129 of 2025
These amounts apply from: 14 April 2026

These amounts replaced the previous ones on 14 April 2026. Figures published before that date are out of date.

Read the published decision

Filing a tax return late
Table 1, row 8
AED 1,000
AED 2,000 if it happens again within 24 months.
Paying the tax late
Table 1, row 9
14% a year
Charged monthly on whatever is still unpaid, from the day after the due date. For a voluntary disclosure or a tax assessment, the clock starts 20 business days after it is submitted or received.
Registering for tax late
Table 1, row 3
AED 10,000
Applying to deregister late
Table 1, row 4
AED 1,000 a month
Capped at AED 10,000.
Not keeping the required records
Table 1, row 1
AED 10,000
AED 20,000 if repeated within 24 months.
Not providing records in Arabic when the FTA asks
Table 1, row 2
AED 5,000
Reduced from AED 20,000 on 14 April 2026.
Not telling the FTA when your details change
Table 1, row 5
AED 1,000
AED 5,000 if repeated within 24 months.
Submitting an incorrect return
Table 1, row 10
AED 500
Waived if you correct the return before the filing deadline, or file a voluntary disclosure that does not change the tax due.
Correcting an error by voluntary disclosure
Table 1, row 11
1% a month
On the difference in tax, running from the day after the original return was due until the disclosure is filed.
Not disclosing an error before the FTA tells you an audit is coming
Table 1, row 12
15% plus 1% a month
A fixed 15% of the tax difference, plus 1% a month. This replaced a fixed 50% charge on 14 April 2026.
Not co-operating with a tax auditor
Table 1, row 13
AED 20,000
Payable personally by the person, their legal representative or their tax agent.
Not accounting for tax due on imported goods
Table 1, row 15
50% of the tax
Of the amount left unpaid or undeclared.

Figures read from the published decisions and last checked on 5 October 2026. They are a guide to the law as published, not advice on your position.

A missed deadline is usually cheaper to fix than to wait on

Most of the amounts above are not one-off. The late payment charge accrues monthly until the tax is settled, the filing charges rise after twelve months, and the voluntary disclosure penalty is far lower before the Authority notifies an audit than after it. Where a penalty has already been issued there is a defined route to reconsideration, instalments and, in some cases, a waiver.

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Answers

UAE tax penalties, answered

The questions businesses ask most, with the figure first.

What is the penalty for filing a VAT return late in the UAE?

AED 1,000 for the first late return, and AED 2,000 if it happens again within 24 months. Paying the VAT late is charged separately, at 14% a year calculated monthly on whatever is still outstanding. Both amounts come from Cabinet Decision No. 40 of 2017 as amended by Cabinet Decision No. 129 of 2025, which took effect on 14 April 2026.

What is the penalty for registering for corporate tax late?

AED 10,000. It is a flat amount and does not grow with the length of the delay, so a business that registers one day late and one that registers six months late pay the same. It was added to Cabinet Decision No. 75 of 2023 by Cabinet Decision No. 10 of 2024.

How much is the fine for a late corporate tax return?

AED 500 for each month or part of a month for the first twelve months, rising to AED 1,000 a month from the thirteenth. It runs from the day after the filing deadline. Paying the tax late is charged on top, at 14% a year.

Did UAE tax penalties change in 2026?

Yes. Cabinet Decision No. 129 of 2025 came into force on 14 April 2026 and changed the VAT, excise and tax procedures penalties. Late payment moved from 2% immediately then 4% a month to a flat 14% a year. Failing to provide records in Arabic fell from AED 20,000 to AED 5,000. The voluntary disclosure penalty moved from a tiered 5% to 40% scale to 1% a month, and the charge for not disclosing an error before an audit fell from a fixed 50% to a fixed 15% plus 1% a month. Figures published before that date are out of date.

What are the penalties under the Economic Substance Regulations?

AED 20,000 for not filing the notification, and AED 50,000 for not filing the economic substance report, for failing the economic substance test, or for providing inaccurate information. Where a business fails the test again in a consecutive year the penalty is AED 400,000. These are set in Cabinet Resolution No. 57 of 2020.

Are there penalties for not using e-invoicing?

Yes. Cabinet Decision No. 106 of 2025 sets AED 5,000 for each month of delay in implementing the system or appointing an accredited service provider, AED 100 for each electronic invoice or credit note not sent on time up to AED 5,000 a calendar month, and AED 1,000 a day for failing to report a system failure. Businesses using the system voluntarily are outside these penalties.

Can a tax penalty be reduced or waived?

In defined circumstances, yes. The Federal Tax Authority operates a process for instalments, waivers and refunds of administrative penalties under Cabinet Decision No. 105 of 2021, and a penalty can be objected to through reconsideration. Whether a case qualifies depends on the facts, so it is worth having the position reviewed before paying.

Are these figures the amount I will actually pay?

They are the amounts the decisions impose. What a business ends up paying also depends on how long the breach ran, whether it is a repeat within 24 months, and whether the tax itself is still outstanding, since the monthly charges keep accruing until it is paid. The figures here are a guide to the published law rather than advice on a particular position.

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