VAT & Corporate Tax Penalties: The Full Fine Schedule
The FTA's penalty framework is strict and applies automatically — there's no grace period, and fines begin the day after a deadline passes. Here's the schedule that actually matters for most businesses.
Corporate Tax penalties
Late registration: a fixed AED 10,000
Late filing: AED 500 per month for the first 12 months, rising to AED 1,000 per month after that
Late payment: 14% per annum on unpaid tax, calculated monthly from the day after the due date
VAT penalties
Late registration and late filing both carry fixed administrative penalties
Repeated late filings within a 24-month period attract higher fines than a first-time lapse
Incorrect returns and voluntary disclosure timing both affect penalty exposure
Filing and paying are treated as a single obligation for Corporate Tax — doing one without the other by the deadline still triggers a penalty.
Because these penalties compound monthly and apply automatically through EmaraTax, the cheapest fix is almost always catching a missed deadline within the first month rather than discovering it later.
This article is for general information and reflects our understanding of FTA guidance at the time of writing. It isn't tax or legal advice — always confirm how these rules apply to your specific situation before acting.