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The Federal Tax Authority has brought into effect amendments that substantially lower administrative penalties imposed for breaches of UAE tax legislation. Cabinet Decision No. 129 of 2025 modifies select provisions within the 2017 decision governing such sanctions. The changes apply to obligations under value added tax, excise tax and general tax procedures according to an FTA statement. Taxpayers stand to gain from these adjustments the authority indicated in its April 15 release.
Failure to submit tax-related documents in the Arabic language will now incur a penalty of 5,000 dirhams down from the prior 20,000 dirhams. The FTA detailed that failing to notify the authority about modifications to tax records carries a 1,000 dirham fine per occurrence with 5,000 dirhams applicable for repeats within 24 months. Previously these stood at 5,000 dirhams for a first offence and 10,000 dirhams thereafter. Legal representatives neglecting to inform the FTA of their appointment face a 1,000 dirham charge payable personally rather than 10,000 dirhams from the earlier structure.
Additional reductions cover penalties for delayed tax remittances inaccurate tax declarations voluntary disclosures and pre-audit error notifications the authority confirmed. According to a DLA Piper publication the decision establishes a unified framework with a 14 percent per annum rate for late payments across VAT excise and corporate tax. This replaces previous compounding mechanisms that included an initial 2 percent plus 4 percent monthly. The Cabinet approved the decision on October 9 2025 with publication in November and enforcement starting April 14 2026.
The Ministry of Finance has made available the full amended text that revises multiple penalty tables to reflect the updated thresholds. Analyses from firms such as Simmons and Simmons dated May 2026 highlight the scope of reductions in the administrative penalty regime. An update from tax consultant Velmont Crest indicated that the voluntary disclosure framework now centres on lower costs for self-corrections prior to audit notifications. The FTA oversees compliance for a broad base of registrants under these revised rules.
The authority has called on registrants to benefit from the advantages of the new decision by reviewing and correcting any prior positions where applicable. Its announcement referenced the entry into force on April 14 and encouraged utilisation of the lowered penalties for late payments and disclosures. Official statements appear on the tax.gov.ae portal detailing all amendments. Further context on the unified approach derives from the original Cabinet issuance.
A briefing by Al Tamimi law firm from April 2026 described the new annualised rate accrued monthly on outstanding tax liabilities. The reform brings VAT and excise rules in line with those already applicable for corporate tax under a separate earlier decision according to Velmont Crest insights. The FTA announcement from April 15 2026 detailed the entry into force of the amendments. Taxpayers can access the PDF of Cabinet Decision No. 129 of 2025 directly from the Ministry of Finance website for comprehensive tables.
