HAMG Consultancy Group

• The standard VAT rate in the UAE is 5% on taxable supplies of goods and services.
• Mandatory VAT registration is required if a business’s taxable supplies and imports exceed AED 375,000 in the past 12 months or are expected to within the next 30 days.
• Voluntary registration is available for businesses with taxable supplies between AED 187,500 – AED 375,000.
• VAT registration must be filed with the Federal Tax Authority (FTA) within 30 days of exceeding the threshold.

• Standard filing: VAT returns must be submitted within 28 days after the end of each tax period (usually quarterly).
• Late return penalty: AED 1,000 for the first time, and AED 2,000 on repetition within 24 months.
• Late payment penalty: 14% per annum monthly penalty on unpaid payable tax.

• The UAE introduced a federal Corporate Tax regime under Federal Decree‑Law No. 47 of 2022.
• Standard Corporate Tax is 0% on profits up to AED 375,000, and 9% on profits above AED 375,000.
• The first full Corporate Tax period began in June 2023, with businesses filing returns within 9 months of their financial year‑end.

As of October 2025, the Federal Tax Authority (FTA) reported over 640,000 corporate tax registrations, indicating broad compliance across mainland and free‑zone entities in the UAE.

• Late registration: AED 10,000. (If the first corporate tax return is filed within 7 months after the end of the tax period, the late registration penalty may be waived under transitional relief).
• Late filing: AED 500 per month (first 12 months), AED 1,000 per month thereafter.
• Late payment: ~14% per annum interest on outstanding amounts.

• Businesses classified as Designated Non‑Financial Businesses and Professions (DNFBPs) must register with the goAML system, an AML reporting platform used to file Suspicious Transaction Reports (STRs) and Suspicious Activity Reports (SARs).
• DNFBPs include: Auditing & accounting firms, Company service providers, Real estate brokers, Precious metals & stones dealers, and Legal consultancies.
• This registration is mandatory under Federal Decree Law No. 20 of 2018 and Cabinet Decision No. 10 of 2019.

Failing to register or report suspicious transactions to the goAML system may result in severe penalties, including heavy administrative fines (starting from AED 50,000 to AED 5,000,000) and regulatory actions enforced by the UAE Ministry of Economy under AML legislation.

• Under UAE VAT compliance principles, penalties for providing incorrect information or failure to disclose entities/transactions can exceed AED 50,000.
• A late registration penalty of AED 10,000 applies if registration is filed after the 30-day deadline from exceeding the threshold.
• Failure to maintain records (books of accounts) can trigger a penalty of AED 10,000 for the first time, and AED 50,000 on repetition.