UAE: New Key Amendments to the Federal Tax Procedures Law Effective Today 1 November 2021
Several modes of settlement of administrative penalties are now introduced – pay 50% in cash or through a guarantee and your tax challenge will be admissible!
The UAE Federal Tax Authority (FTA) will today start implementing new procedures to facilitate the ease for tax registrants to submit reconsideration requests and objections to the FTA’s decisions, for implementing the decisions of the Tax Dispute Resolution Committee (TDRC), appeal procedures, controls for reducing administrative penalties, the payment of penalties over installments and exempting penalties.
The FTA has clarified that the new procedures concern the implementation of Federal Decree-Law No. (28) of 2021 (amending some provisions of Federal Law No. (7) of 2017 on Tax Procedures) and come into effect today, 1 November 2021. The FTA has indicated that any person shall have the right to submit a request to the FTA for reconsideration of any decision issued by the FTA, provided it is a reasoned request and meets the prescribed conditions, within (40) working days from the date of its notification of the decision. The FTA shall examine the request for reconsideration, decide thereon, under a reasoned resolution, within (40) working days from the date of receiving the request, and inform the applicant within five working days from the date of the issuance of the decision.
The taxpayer has (40) working days from receiving the decision to submit an objection before the TDRC. Under Article (30) of the amended law, the taxpayer is no longer considered inadmissible if the penalty has not been settled in connection with the objection (only the tax should be settled).
The FTA has also explained that the Decree-Law specifies the procedures for appealing before the competent courts. The appeal request should be submitted within (40) working days from the date the FTA or the taxpayer is notified of the TDRC’s decision, in the event of an objection to the decision of the TDRC or if the committee fails to issue a decision.
The Decree-Law states that the appeal shall not be accepted by the competent court in specific cases. These include failure to provide evidence that the taxpayer has paid no less than 50% of the value of the prescribed administrative penalty, either through cash payment or bank guarantee in favor of the authority.