Legislation Details
- Full Title: Federal Decree by Law Concerning Tax Procedures
- Law Type: Federal Decree-Law
- Law Number: [28] of 2022
- Issued Date: 30 Sep 2022
- Effective Date: 01 Mar 2023
- Official Gazette: No. 737
- Sector: Tax
- Status: Active
- Number of Articles: 145
- Chapters/Parts: 0
- Amendments: 2
Summary
This Federal Decree-Law regulates the rights and obligations of the Federal Tax Authority (FTA), taxpayers, and other persons dealing with the FTA in the UAE. It establishes common procedures and rules applicable to all federal tax laws in the UAE. The law aims to enhance tax compliance and administration, ensuring a fair and efficient tax system that supports the UAE's economic development. It is a comprehensive piece of legislation that covers key aspects such as tax registration, record-keeping, tax returns, tax audits, tax assessments, objections and appeals, tax recovery and collection, and penalties for non-compliance. The law is of significant practical importance for businesses and individuals subject to federal taxes in the UAE. (Federal Decree by Law Concerning Tax Procedures, 2022, Art. 1-2)
What is the scope and purpose of this law?
The scope of this Federal Decree-Law is to regulate the rights and obligations of the Federal Tax Authority (FTA), taxpayers, and any other persons dealing with the FTA, in compliance with the provisions of this law or the applicable tax laws in the UAE. It establishes common procedures and rules applicable to all federal tax laws in the country. The law aims to enhance tax compliance and administration, ensuring a fair and efficient tax system that supports the UAE's economic development. (Federal Decree by Law Concerning Tax Procedures, 2022, Art. 2)
What are the key definitions under this law?
The law provides the following key definitions:
- State: The United Arab Emirates
- Minister: The Minister of Finance
- FTA: The Federal Tax Authority
- Director-General: The Director General of the FTA
- Business Day: Any weekday, except for weekends and public holidays of the Federal Government
- Committee: The Tax Dispute Settlement Committee
- Competent Court: The federal court within the jurisdiction of which the headquarters of the FTA or any of its branches is located
- Tax: Any federal tax levied by virtue of the Tax Law where the management, collection and implementation thereof is entrusted to the FTA
- Tax Law: Any federal law whereby the Tax is levied
- Tax Domicile Certificate: A certificate issued by the FTA confirming the tax domicile of a person in the UAE
- Tax Resident: A person residing in the UAE
- Person: A natural or legal person
- Business: Any activities carried out regularly, continuously and independently by any person anywhere
- Taxable Person: Any person registered or required to be registered for the purpose of the provisions of the Tax Law
- Taxpayer: Any person required to pay the tax in the UAE under the Tax Law, whether a Taxable Person or end consumer
- Tax Return: The information and data specified for taxation purposes and provided by the Taxable Person
- Tax Period: The period of time specified in the Tax Law for which the tax due is required to be calculated
- Tax Registration: The procedure whereby a person registers its name with the FTA or the latter registers the same with it, for tax purposes
- Tax Registration Number: A unique number issued by the FTA for each person for tax purposes
- Registered Person: The Taxable Person having a Tax Registration Number
- Legal Representative: A guardian, trustee or curator with regard to incapacitated persons or persons with diminished capacity, or the court-appointed bankruptcy trustee with regard to a company undergoing bankruptcy, or any person legally appointed to represent another person
- Due Tax: A tax that is calculated and levied under the provisions of the Tax Law
- Payable Tax: A tax payable to the FTA
- Administrative Fines: Sums imposed on a person by the FTA due to the violation of the provisions of this Decree-Law, the Tax Law or the cabinet resolutions issued in implementation thereof
- Refundable Tax: Amounts refundable by the FTA to the taxpayer, in whole or in part, pursuant to the Tax Law and this Decree-Law
- Tax Assessment: A decision made by the FTA under Article 23
- Assessment of Administrative Fines: A decision issued by the FTA on the administrative fines
- Notification: Notifying the person of decisions issued by the FTA, as per the means set forth in this Decree-Law and the Executive Regulations
- Voluntary Declaration: A form designated by the FTA whereby the taxpayer notifies the FTA of any error or omission in the tax return, tax assessment or tax recovery application
- Register: The Tax Agent Register
- Tax Agent: Any person registered with the FTA authorized by another person to represent it before the FTA, help it to perform its tax obligations and exercise its relevant tax rights
- Tax Audit: A procedure carried out by the FTA for auditing commercial records or any information, data or commodities related to a person to verify the fulfillment of their obligations under this Decree-Law or the Tax Law
- Tax Auditor: Any FTA employee appointed to carry out the tax audit
- Tax Evasion: The person's use of illegal means that result in reduced amount of the due tax, non-payment of tax or recovery of a tax which the taxpayer has no right to recover according to this Decree-Law or the Tax Law
- Executive Regulations: The Executive Regulations of this Decree-Law
- E-Invoicing System: An electronic system specifically used for issuing, sending, exchange and sharing of the details of invoice and credit note according to the provisions of this Decree Law
(Federal Decree by Law Concerning Tax Procedures, 2022, Art. 1)
What are the main obligations and requirements?
The key obligations and requirements under this law include: 1. Persons carrying out any business or subject to an obligation under the Tax Law must keep records for their accounting activities and commercial books, as well as any tax-related information, in conformity with the controls laid down by the Executive Regulations. (Art. 4) 2. The Minister shall issue resolutions for implementing the E-Invoicing System, determining its effective date, and the requirements and provisions required for carrying out the relevant controls, rules and procedures. Persons designated by the Minister shall be subject to the E-Invoicing System. (Art. 4 BIS) 3. Taxable Persons must submit the tax return as well as data, information, records and documents related to the tax they are obligated or required to submit to the FTA in Arabic, unless the FTA accepts them in another language. (Art. 5) 4. Registered Persons must include their Tax Registration Number in all communications and transactions with the FTA and third parties, notify the FTA of any changes to their registered information, and submit a deregistration application when required. (Art. 6) 5. The Legal Representative must notify the FTA of their appointment, submit tax returns on behalf of the Taxable Person, and comply with the requirements under this Decree-Law and the Tax Law. (Art. 7) 6. Taxable Persons must prepare and submit the tax return to the FTA, and pay any payable tax within the time limit set forth in this Decree-Law and the Tax Law. (Art. 8) 7. Taxpayers must pay the payable tax and administrative fines within the time limit defined in this Decree-Law and the Tax Law. (Art. 8, 9) (Federal Decree by Law Concerning Tax Procedures, 2022, Art. 4-9)
What licensing, registration, or approval requirements exist?
The key licensing, registration, and approval requirements under this law are: 1. Taxable Persons may submit a tax registration application to the FTA pursuant to the provisions set forth in the Tax Law. (Art. 6) 2. Registered Persons must include their Tax Registration Number in all communications and transactions with the FTA and third parties, notify the FTA of any changes to their registered information, and submit a deregistration application when required. (Art. 6) 3. The Executive Regulations shall determine the tax registration and deregistration procedures as well as the amendment to registered data. (Art. 6) 4. Government bodies in charge of granting business licenses must notify the FTA upon granting any license, no later than 20 business days from the issuance date of the license, as stipulated in the Executive Regulations. (Art. 6) 5. The Legal Representative must notify the FTA of their appointment, within 20 business days from the appointment date, according to the procedures defined by the Executive Regulations. (Art. 7) (Federal Decree by Law Concerning Tax Procedures, 2022, Art. 6-7)
Which authorities or bodies are responsible for enforcement?
The key authorities and bodies responsible for enforcement under this law are: 1. The Federal Tax Authority (FTA): The FTA is responsible for the management, collection and implementation of federal taxes in the UAE. The FTA has the following key roles and powers: - Conducting tax audits and accessing records (Art. 16-17) - Issuing tax assessments and administrative fine assessments (Art. 23-24) - Imposing penalties for non-compliance (Art. 25-26) - Establishing the Tax Dispute Settlement Committee (Art. 30) - Collecting payable taxes and administrative fines (Art. 40-43) 2. The Tax Dispute Settlement Committee: This committee is responsible for resolving tax disputes between taxpayers and the FTA. It has the power to review tax assessments and administrative fine assessments, and its decisions can be appealed before the courts. (Art. 30-37) 3. The Competent Court: The federal court within the jurisdiction of which the headquarters of the FTA or any of its branches is located has jurisdiction over appeals against the decisions of the Tax Dispute Settlement Committee. (Art. 1, 36) (Federal Decree by Law Concerning Tax Procedures, 2022, Art. 16-17, 23-26, 30-37, 40-43)
What are the penalties for non-compliance?
The law specifies the following penalties for non-compliance: 1. Tax Crimes and Penalties: - Failure to register for tax purposes: Imprisonment for a period not exceeding 3 years and/or a fine not exceeding AED 1 million. - Failure to submit a tax return: Imprisonment for a period not exceeding 3 years and/or a fine not exceeding AED 1 million. - Tax evasion: Imprisonment for a period not exceeding 5 years and/or a fine not exceeding AED 5 million. - Obstruction of tax audits: Imprisonment for a period not exceeding 3 years and/or a fine not exceeding AED 1 million. - Failure to comply with e-invoicing requirements: Imprisonment for a period not exceeding 3 years and/or a fine not exceeding AED 1 million. (Art. 25) 2. Administrative Fines: - The FTA may impose administrative fines for various violations of this Decree-Law or the Tax Law, with the amounts specified in the Executive Regulations. (Art. 24, 26) The law also empowers the FTA to take various procedures and measures to ensure compliance, such as suspending a person's activity, revoking their tax registration, or publishing their name. (Art. 26) (Federal Decree by Law Concerning Tax Procedures, 2022, Art. 25-26)
What fees, charges, or financial provisions are specified?
The law does not specify any fees, charges, or financial thresholds. It states that the FTA may charge fees for the services it provides, with the amounts to be determined by the Executive Regulations. (Art. 54) (Federal Decree by Law Concerning Tax Procedures, 2022, Art. 54)
What exemptions or exceptions apply?
The law does not provide any explicit exemptions or exceptions. It applies generally to all persons subject to federal taxes in the UAE, without any specified exclusions.
How are disputes resolved under this law?
The law establishes a comprehensive dispute resolution mechanism: 1. Application for Tax Assessment Review: A person may apply to the FTA for a review of a tax assessment within 40 business days from the date of receiving the assessment. (Art. 28) 2. Application for Reconsideration: If the person is not satisfied with the FTA's decision on the tax assessment review, they may submit an application for reconsideration within 40 business days from the date of receiving the decision. (Art. 29) 3. Objection to the Tax Dispute Settlement Committee: If the person is not satisfied with the FTA's decision on the reconsideration application, they may submit an objection to the Tax Dispute Settlement Committee within 40 business days from the date of receiving the decision. (Art. 30-33) 4. Appeal to the Courts: The person may appeal the Committee's decision before the competent court within 60 calendar days from the date of receiving the decision. (Art. 36) The law also provides for special procedures for objection and appeal in certain cases. (Art. 37) (Federal Decree by Law Concerning Tax Procedures, 2022, Art. 28-37)
What are the key deadlines and time limits?
The key deadlines and time limits specified in the law include: 1. Notification of changes to registered information: 20 business days from the occurrence date of such changes. (Art. 6) 2. Notification of appointment of Legal Representative: 20 business days from the appointment date. (Art. 7) 3. Application for tax assessment review: 40 business days from the date of receiving the assessment. (Art. 28) 4. Application for reconsideration: 40 business days from the date of receiving the FTA's decision on the assessment review. (Art. 29) 5. Submission of objection to the Tax Dispute Settlement Committee: 40 business days from the date of receiving the FTA's decision on the reconsideration application. (Art. 32) 6. Appeal of the Committee's decision to the courts: 60 calendar days from the date of receiving the decision. (Art. 36) (Federal Decree by Law Concerning Tax Procedures, 2022, Art. 6-7, 28-32, 36)
How does this law interact with other UAE legislation?
This Federal Decree-Law on Tax Procedures interacts with the following other UAE federal laws: 1. It repeals and replaces the previous Federal Decree-Law No. (7) of 2017 on Tax Procedures. (Art. 55) 2. It references and complements various other federal tax laws, including: - Federal Law No. (11) of
Source Documents
This article analyses Federal Decree by Law Concerning Tax Procedures for legal research and educational purposes. For the purpose of interpretation and application, reference must be made to the original Arabic text. In case of conflict, the Arabic text prevails. This does not constitute legal advice.