Administrative penalties under VAT in UAE

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Administrative penalties under VAT in UAE

• The UAE cabinet has approved the complete list of
  all the administrative VAT Fines and vat
  Penalties in UAE that will be imposed on
  businesses for violations of the VAT laws.
   Administrative penalties are additional amounts
  imposed on a taxable person for breaching the
  provisions of the VAT Law. Below are some of the
  actions which invite administrative penalties
  under VAT in UAE.

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 Penalty for failing to display the prices
inclusive of VAT

• Every person eligible for tax should display the
  price of goods or services taxable, except in the
  following cases
• The supply is for exports
• The customer is a registrant
• Import of goods or services.
• Failure by the taxable person to notify the FTA
  charge of Tax (based on margin)
• A taxable person should calculate tax on the
  profit margin on the supply of second-hand goods,
  antique stamps, coins, etc. The profit margin is
  the difference between the purchase price and the
  selling price of the goods.
• Failure to comply with the conditions and
  procedures related to moving and keeping goods in
  a designated zone.
• A Designated zone is considered outside the state
  of UAE for the purpose of VAT. As a result, any
  transfer of goods between designated zones,
  results in zero VAT levied.
• Failure to register for VAT in UAE
• If a VAT eligible business in the UAE fails to
  register within the specified timeline, it will
  have to pay a penalty.
• A penalty of Dh20,000 shall be applicable to
  those registrants who fail to submit a
  registration application within the specified
  timeframe.

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Taxable persons right to object penalties

• Any taxable person has the right to object when
  any of the above-mentioned penalties are imposed
  by authorities. A request can be submitted to
  reconsider the imposition of penalty. A taxable
  person has to give a valid reason for
  reconsideration.
• Registrant failing to settle any penalties within
  the specified timeframe can seek the guidance of
  a VAT expert for further remedy.

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VAT registration in UAE

• You may also consult a VAT expert to avoid any
  kind of penalties imposed on your business and
  also can get better insights on complying with
  the rules and regulation according to VAT law.
  Our team has assisted business from many
  industries effectively manage their tax-related
  matters and helped avoid VAT penalties. If you
  are also seeking to help hand for dealing with
  the VAT-related issues, you can contact us.