The updated decision outlines penalties for breaches under the Tax Procedures Law and the Tax Law, encompassing record-keeping, registration, tax returns, payments, and voluntary disclosures, which takes effect from 14 April 2026.
The UAE Ministry of Finance has issued a consolidated version of Cabinet Decision No. 40 of 2017, which outlines administrative penalties for tax law violations, as updated by Cabinet Decision No. 129 of 9 October 2025.
The updated decision outlines penalties for breaches under the Tax Procedures Law and the Tax Law, encompassing record-keeping, registration, tax returns, payments, and voluntary disclosures.
The main violations and their corresponding penalties are summarised in the table below:
| No. | Violation | Penalty |
| 1 | Failure to keep required records and other information under the Tax Procedures Law or Tax Law | AED 1,000 per violation; AED 20,000 for repeated violations within 24 months |
| 2 | Failure to submit data, records, and documents related to tax in Arabic when requested | AED 5,000 |
| 3 | Failure to submit a registration application within the specified timeframe | AED 10,000 |
| 4 | Failure to submit a deregistration application within the specified timeframe | AED 1,000 per late submission, applied monthly up to AED 10,000 |
| 5 | Failure to inform the Authority of any amendments to tax record information | AED 1,000 per violation; AED 5,000 for repeated violations within 24 months |
| 6 | Legal Representative fails to provide notification of their appointment on time | AED 1,000 (from the representative’s own funds) |
| 7 | Legal Representative fails to file a Tax Return on time | AED 1,000 for first time; AED 2,000 if repeated within 24 months |
| 8 | Registrant fails to submit a Tax Return within the timeframe | AED 1,000 for first time; AED 2,000 if repeated within 24 months |
| 9 | Failure to settle the Payable Tax on time | Monthly penalty of 14% per annum on the unsettled amount, applied from the day after the due date; due date for voluntary disclosure: 20 business days from submission; for tax assessment: 20 business days from receipt |
| 10 | Submission of an incorrect Tax Return | AED 500, unless corrected within the deadline or via voluntary disclosure without causing a tax difference |
| 11 | Errors in Tax Return, Tax Assessment, or tax refund application corrected through Voluntary Disclosure | Monthly penalty of 1% on the Tax Difference, applied from the day after the due date until voluntary disclosure submission |
The new rules will take effect from 14 April 2026
