VAT Penalty Waiver
In the United Arab Emirates, all taxable businesses are mandated to comply with tax procedure law. Suppose an individual or corporate is in non-compliance with the VAT regulations, the entity will be penalized by FTA. However, the Federal Tax Authority has enabled the taxpayer to lower or eliminate administrative penalties in the UAE. The taxable person can apply for VAT reconsideration and submit a VAT penalty waiver application.
Our Bestax Chartered Accountants and tax consultants in Dubai provide an exclusive VAT service in all major industries. Our priority is to protect our national and international clients against heavy fines and penalties. Let’s understand the authorized way of waiving the VAT penalty.
VAT Penalty Reconsideration Form
The VAT Penalty reconsideration form is available on the official portal of the Federal Tax Authority. The purpose is to make authorities aware of any mistake or omission in VAT return filing or VAT refund submission & that the taxable entity is not satisfied with the FTA’s decision to impose fines. VAT Penalty Reconsideration is the proactive approach to waiving the VAT penalties and sanctions.
VAT Penalty Waiver Application
The VAT penalty waiver is an official document to settle non-compliance VAT penalties and interests in the United Arab Emirates. This form is submitted when you agree with the authority’s decision but utilize FTA pre-defined techniques to vanish fines. Any taxpayer can apply for a waiver, but the approval and rejection of the VAT penalty waiver application form depend upon FTA. The regulatory authorities will review all your evidence, reasoning, and documents to eradicate or minimize the penalty if possible.
The Objective Of Waiving Off Penalty
The VAT penalty waiver form’s main objective is to provide a chance for taxpayers to prove their VAT non-compliance case in front of the FTA. Because the UAE authorities have strict laws and timeframes for submitting VAT return filing, VAT refund, VAT registration & many others, if a taxable business fails to comply with any of them, it may attract high fines. This penalty, over time, continues to accumulate & becomes a burden on the pocket of the taxable person. That’s why the Federal Tax Authority enables entities to appeal for VAT penalty waivers in the UAE. While the taxpayer may apply for a waiver, this does not mean that the request will be granted. It’ll ultimately be the FTA’s decision whether to waive the penalty or to keep it, all after they review your evidence, documents & so forth. Our tax consultants will help you read all of the required documents to increase your appeal’s chances of acceptance.
Provisions To Appeal For A Waiver
The Cabinet Decision No. 51 of 2021 amended certain provisions under Article 26 of Cabinet Decision No. 36 on the Executive Regulations of Federal Law No. 7 of 2017 on Tax Procedures. Penalties and interest may be reduced or entirely waived off by the FTA, depending on justification and evidence. The VAT penalty Waiver in the UAE has some necessary conditions to be met before applying.
- Applicants seeking waivers of penalty and interest must support their requests with adequate evidence
- The taxable person has made payment of the principal tax
- The taxpayer has never defaulted on any other taxes
- Significantly, the taxable entity has not indulged in any administrative penalties in the last two years
- Waivers are not granted for penalties and interest incurred due to tax fraud or tax evasion
Process Of Penalty Waiver Request In UAE
The VAT penalty Waiver application is submitted online via FTA’s official website. The portal asks you to fill out some boxes available on the form & attach verified evidence with the application to make your case strong against the Federal Tax Authority’s penalty. Penalty waiver requests are made through:
- The VAT Penalty Reconsideration application
- Appeal to TDRC (Dubai tax dispute resolution committee)
- A reduction/exemption application
Time Frame For Waiver Request
There is a specific deadline for the administrative penalty reduction or waiver application submission. The taxable entity must request in 40 business days from the occurrence of the FTA penalty. The new decision sets out a formal application process to request a waiver approved by the FTA. FTA will notify the applicant of any other follow-up queries via email.
How Can BestaxCA Assist You In Waiving The Penalty?
The BestaxCA is one of the leading accounting and tax consultancy firms in Dubai, United Arab Emirates. Our team of certified accountants helps businesses in the relevant VAT provisions as per the tax procedure law. We will do everything in our power to keep you away from being sanctioned for non-compliance by the FTA. Our tax experts provide all guidance on preparing and submitting the VAT penalty waiver application as per standards. We compile all your necessary documents for waiver evidence because any error may reject or delay the request. We insight your financial records to intricate the legal procedure to reverse the penalty. So, take advantage of BestaxCA and waive your accrued VAT penalties and interest. Any individual or company can contact us for more information: