An offense
will be charged by a person who, under Section 51(1) (a), does not get
registered for value-added tax right according to section 12 of value-added
tax. No matter whether the person is knowledgeable about the value-added tax
liability or not, they will be penalized if they don’t get registered for VAT
within the timeframe. The penalty for not registering for value-added tax
within the timescale is AED 20,000.
The fines
and penalties will be no fewer than AED 500 and not more than 300% of the value
of the tax on the transaction in question.
Failure
to keep the records
Keeping the
required documents and data is essential if you do not want to get penalized.
The penalty for not following the data needed for value-added tax in Dubai is
10,000 United Arab Emirates Dirham for the first time. If the breach is
repeated, AED 50,000 will be imposed as fine for each repeated offense.
Additionally, if the records are not submitted in the Arabic language if the
Authority asks for it, 20,000 United Arab Emirates Dirham will be charged as
penalty.
Failure
to Deregister
If a company
does not submit the application of deregistration within the timeframe defined
in the Tax Laws, it will be charged 10,000 United Arab Emirates Dirham.
Failure
to inform about Amendments
If any
alteration is made in the value-added tax records, the authorities should be
informed about it, or else, AED 5,000 will be charged for the first-time
violation, and 15,000 United Arab Emirates Dirham will be charged if the act is
reciprocated.
Failure
to file the tax return
The UAE
value-added tax consultants or legal representatives should register for the VAT return in UAE on time, or else the
penalty charged to the authorized representative will be 1,000 United Arab
Emirates Dirham for the first time. Still, on repetition within 24 months, AED
2,000 will be charged. For not notifying the Tax Authorities for such
appointments within the specific time, the representative can be charged 20,000
United Arab Emirates Dirham as a penalty that will be due to the representative’s
funds.
Incorrect
tax returns submission
In case of
wrong tax return submission, a penalty of 3,000 United Arab Emirates Dirham
will be implemented for the first time, whereas 5,000 United Arab Emirates
Dirham will be used in case of a repetition of incorrect submission. These are
fixed penalties. The penalties applied based on the percentage of the tax
amount not paid to the tax authorities due to the failure in submissions. The
fine imposed in percentage can be either 5%, 30%, or 50% of the not paid tax
amount, depends on how early the submitter notifies the fault concerning the
tax audit by the Authority.
Disclosure
of Business Errors
United Arab
Emirates Dirham 3,000 is applied for the first time and 5,000 AED for repeating
the identical as a fixed penalty. But the voluntary declaration by the Taxpayer
of the business mistakes in Tax Returns, Assessment, or Refund request will
impose the penalty in the percentage of the unpaid tax amount due to business
mistakes. Repeatedly, the percentage penalty is it 5%, 30%, or 50% depends upon
when the Taxpayer informed the authorities of the errors to the initiation of a
Tax audit by the Tax Authority.
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