{"id":150612,"date":"2026-10-12T11:27:52","date_gmt":"2026-10-12T11:27:52","guid":{"rendered":"https:\/\/www.legal500.com\/guides\/?post_type=comparative_guide&#038;p=150612"},"modified":"2026-10-12T12:14:33","modified_gmt":"2026-10-12T12:14:33","slug":"uae-tax-disputes","status":"publish","type":"comparative_guide","link":"https:\/\/www.legal500.com\/guides\/chapter\/uae-tax-disputes\/","title":{"rendered":"United Arab Emirates: Tax Disputes"},"content":{"rendered":"","protected":false},"template":"","class_list":["post-150612","comparative_guide","type-comparative_guide","status-publish","hentry","guides-tax-disputes","jurisdictions-uae"],"acf":[],"appp":{"post_list":{"below_title":"<div class=\"guide-author-details\"><span class=\"guide-author\">Habib Al Mulla &amp; Partners<\/span><span class=\"guide-author-logo\"><img src=\"https:\/\/www.legal500.com\/guides\/wp-content\/uploads\/sites\/1\/2026\/09\/19-1.jpg\"\/><\/span><\/div>"},"post_detail":{"above_title":"<div class=\"guide-author-details\"><span class=\"guide-author\">Habib Al Mulla &amp; Partners<\/span><span class=\"guide-author-logo\"><img src=\"https:\/\/www.legal500.com\/guides\/wp-content\/uploads\/sites\/1\/2026\/09\/19-1.jpg\"\/><\/span><\/div>","below_title":"<span class=\"guide-intro\">This country specific Q&amp;A provides an overview of Tax Disputes laws and regulations applicable in United Arab Emirates<\/span><div class=\"guide-content\"><div class=\"filter\">\r\n\r\n\t\t\t\t<input type=\"text\" placeholder=\"Search questions and answers...\" class=\"filter-container__search-field\">\r\n\t\t\t<\/div>\r\n\r\n\t\t\t\r\n\r\n\r\n\t\t\t<ol class=\"custom-counter\">\r\n\r\n\t\t\t\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Is it necessary for a taxpayer to register with the tax authority? Are separate registrations required for corporate income tax and value added tax\/sales tax?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Registration with the Federal Tax Authority (&#8220;FTA&#8221;) is mandatory. A person who meets the relevant criteria under the applicable substantive tax law (Value Added Tax, Excise Tax, or Corporate Tax) must apply to the FTA for registration; the FTA reviews the application and decides to approve it, reject it, or request further information. A person is only treated as registered once a Tax Registration Number (&#8220;TRN&#8221;) is issued (or reactivated) \u2013 not merely on receiving preliminary approval \u2013 and registration takes effect from the date the FTA fixes in the registration certificate.<\/p>\n<p>Registration must be sought separately for each type of federal tax: Value Added Tax, Excise Tax and Corporate Tax each require their own, independent registration application (and, correspondingly, their own deregistration application), even where the same person is registered for more than one tax. The 15-digit TRN itself encodes the tax type in its final digit. Failing to register, or to deregister, within the statutory time frame is an administrative violation attracting a fixed monetary penalty.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">In general terms, when a taxpayer files a tax return, does the tax authority check it and issue a tax assessment, or is there a self-assessment system where the taxpayer\u2019s own assessment stands unless the tax authority intervenes?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>All UAE federal taxes operate on a self-assessment basis. Taxpayers calculate, report and pay tax themselves through periodic returns filed electronically, and there is no requirement for the FTA to review and formally approve a return before it takes effect. The return itself does not create the tax liability \u2013 that arises directly from the substantive tax law \u2013 it is simply the means by which the taxpayer notifies the FTA of its position for the relevant period.<\/p>\n<p>The FTA&#8217;s oversight is instead exercised after the event, principally through tax audits and any resulting tax and administrative penalty assessments, which are the tools the FTA uses to verify compliance and correct the self-assessed position where discrepancies are found.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Can a taxpayer amend their return after it has been filed? If so, are there any time limits for doing so?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Yes, but the correct mechanism depends on the size and direction of the error. Where an error results in a difference of AED 10,000 or less in the FTA&#8217;s favour, and a further return is still due before the relevant limitation period expires, the taxpayer may simply correct it in that next return without any separate filing. In every other case \u2013 an error in the taxpayer&#8217;s own favour of any size, an FTA-favourable error exceeding AED 10,000, or a case where no further return remains available (for example, following deregistration) \u2013 the taxpayer must submit a voluntary disclosure to the FTA.<\/p>\n<p>A voluntary disclosure against an error in favour of the taxpayer must generally be made within 20 business days of the taxpayer becoming aware of the error, but generally cannot be submitted more than five years after the end of the relevant tax period. Making a timely voluntary disclosure is also the principal way a taxpayer can proactively correct its position and reduce its exposure to the higher administrative penalties that apply if the same error is instead uncovered later during an FTA audit.<\/p>\n<p>Notwithstanding the above, where a tax return is filed well ahead of the expiration of the prescribed deadline, and subject to the deadline not lapsing, the taxpayer may simply correct the tax return electronically through an amendment option on the FTA\u2019s portal.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Please summarise the main methods by which a tax authority may challenge the amount of tax a taxpayer has paid by way of an initial assessment\/self-assessment. Does the tax authority need any justification to commence such a challenge?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>The FTA&#8217;s principal method of challenge is the tax audit: an examination of a person&#8217;s commercial records, information, data or goods to verify compliance. Audits may take place at the FTA&#8217;s premises or elsewhere, generally with at least 10 business days&#8217; prior notice, subject to limited exceptions (an internally approved surprise audit, or an audit of a private residence, which requires Public Prosecution authorisation). Separately, and even outside a formal audit, the FTA has a broad general power to request accounting records, commercial books and any other data or information from any person in order to carry out its functions. Following an audit, the FTA issues a tax assessment and, where relevant, a separate administrative penalty assessment.<\/p>\n<p>The FTA is not required to justify or evidence any particular suspicion before opening an audit. The implementing regulation does direct the FTA to have regard to certain factors before deciding to audit \u2013 such as whether an audit is necessary to protect the integrity of the tax system, the person&#8217;s likely responsibility for compliance, the tax revenue expected to be recovered, and the compliance burden involved \u2013 but this is framed as a guiding consideration rather than a binding precondition, and an audit remains valid even where these factors are not shown to have been taken into account.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">What are the time limits for a tax authority to commence a challenge to the taxpayer\u2019s assessment\/self-assessment (disregarding any override of these limits to comply with obligations to provide relief from double taxation under a tax treaty)? Does a tax authority have any options to challenge a self-assessment after expiry of the relevant time limit?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>As a general rule, the FTA may not conduct a tax audit or issue a tax assessment more than five years after the end of the relevant tax period. However, this general limit is subject to three separate extensions. First, and most significantly, if the FTA notifies the taxpayer that a tax audit is commencing before the five-year period expires, the FTA may complete that audit and issue the resulting assessment within a further four years from the date of that notice \u2014 meaning the process can, in practice, run for up to nine years from the end of the tax period, provided the audit notice itself was issued in time. Second, where a voluntary disclosure is filed in the fifth year, the FTA may audit or assess within one further year of that disclosure. Third, where a refund claim is made in the fifth year, the FTA may audit or assess within two further years of that claim.<\/p>\n<p>The five-year period is separately extended to 15 years in two situations: where the audit or assessment concerns tax evasion (running from the end of the tax period in which the evasion occurred), and where it concerns a failure to register (running from the date registration ought to have taken place). Outside these windows, the FTA has no further statutory route to open an audit or reassess a taxpayer for the relevant period, subject only to the general grounds recognised under UAE civil law for the interruption of limitation periods.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">How is tax fraud defined under the laws of your jurisdiction?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Tax evasion is defined as a person&#8217;s use of illegal means resulting in a reduction of the tax due, non-payment of tax, or the recovery of a tax refund to which the person was not entitled. Both limbs must be satisfied: the means used must be unlawful, and there must be an actual resulting shortfall in tax revenue (or an unwarranted refund) \u2013 a claim made through entirely lawful channels is not evasion, and, conversely, an attempt using unlawful means that does not in fact reduce tax revenue does not complete the evasion offence (although it may constitute a different tax offence).<\/p>\n<p>The UAE&#8217;s highest federal court has also held that, at least for the principal evasion offences, both general criminal intent and a specific intent to evade tax (or wrongfully obtain a refund) must be established \u2013 an incorrect filing position or simple negligence is not, of itself, sufficient to constitute tax evasion.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">How is tax fraud treated? Will the tax authority conduct a criminal investigation with a view to seeking prosecution and a custodial sentence?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Tax evasion, deliberate non-payment of an administrative penalty once due, and a limited set of other listed tax offences (such as knowingly submitting false information, destroying required records, or obstructing FTA officials) are criminal offences carrying imprisonment, a fine, or both. Evasion itself carries a fine of 100% to 300% of the evaded tax, imprisonment, or both; the other listed offences carry a fine of up to AED 1,000,000 (escalating to the evasion-level penalty where evasion in fact results).<\/p>\n<p>Criminal proceedings cannot be initiated by the FTA itself. A criminal case can only be brought following a written request from the FTA&#8217;s Director General to the Public Prosecution, which retains full discretion whether to proceed. Before a case is referred to the Public Prosecution, the FTA alone may agree a settlement with the alleged offender, in exchange for full payment of the tax and administrative penalties due (plus, for certain offences, a fixed additional amount). Once a case has been referred, the power to settle passes to the Public Prosecution, which may still do so \u2014 before or even after conviction \u2014 but only after seeking the FTA&#8217;s (non-binding) opinion, and on payment of an increased amount that includes an additional percentage of the evaded tax. Separately, conviction or acquittal in the criminal case does not affect the taxpayer&#8217;s underlying liability for tax and administrative penalties, which generally remain payable regardless of the outcome of any prosecution (save where an acquittal is specifically based on a finding that the taxpayer did not commit the act in question).<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Does the tax authority have to abide by any standards or a code of conduct when carrying out audits? Does the tax authority publish any details of how it conducts audits in practice?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Rather than a single freestanding code of conduct, the Tax Procedures Law and its implementing regulation set out a detailed framework of reciprocal statutory rights and obligations that govern how an audit is conducted. These include minimum advance notice of an audit (subject to limited exceptions for internally approved surprise audits or audits of a private residence); the audited person&#8217;s right to see the auditor&#8217;s identification, to receive a copy of the audit notification, to attend any audit conducted away from the FTA&#8217;s premises, and to receive copies of original documents seized; and confidentiality obligations on FTA staff regarding information obtained during an audit.<\/p>\n<p>The FTA does not publish a detailed public operational manual on how audits are run in practice, although it does issue general, non-binding guides addressing specific tax types, and is directed by the implementing regulation to have regard to considerations such as necessity, the person&#8217;s likely responsibility for compliance, expected revenue, and compliance burden before deciding to audit \u2013 albeit as guiding rather than binding requirements.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Does the tax authority have the power to compel the production of information? Does this extend to emails? Is there a right of appeal against the use of such a power?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Yes. The FTA has a broad statutory power to request accounting records, commercial books and any other data, information or goods from a taxpayer, whether during a formal audit or otherwise. This power is not confined to any particular medium and extends to electronic records and communications, including emails, held by that person. Statutory minimum and maximum response windows apply by default \u2013 a person cannot generally be required to comply in fewer than 5 business days, nor (subject to extension) more than 40 business days \u2013 unless a specific provision states otherwise.<\/p>\n<p>There is no standalone right of appeal against the mere issuance of an information request. A taxpayer&#8217;s remedy instead lies in challenging the tax or penalty assessment that ultimately results from the audit, through the tax assessment review, reconsideration and objection process described below.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Does the tax authority have the power to compel the production of information from third parties? Is there a right of appeal against the use of such a power?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Yes \u2013 the FTA&#8217;s power to request records, data and information is not confined to the taxpayer under audit; it extends to any person, including third parties who may hold relevant records. As with a request directed at the taxpayer itself, there is no separate or independent right of appeal against a request addressed to a third party. Any recourse would arise indirectly, through a subsequent challenge to an assessment that comes to rely on information obtained from that third party.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Is it possible to settle an audit by way of a binding agreement, i.e. without litigation?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Outside the criminal sphere, there is no general mechanism for a taxpayer to settle an audit&#8217;s findings with the FTA by private agreement in place of the statutory review, reconsideration and objection process. The relationship between the FTA and a taxpayer is a regulatory one rather than a contractual one, and tax and penalty liabilities are fixed by law rather than by agreement.<\/p>\n<p>That said, two adjacent mechanisms can avoid full litigation in narrower circumstances. A dedicated committee may approve instalment plans or a full or partial waiver or refund of administrative penalties (though not of the tax itself) where an acceptable excuse, or genuine inability to pay in one lump sum, is shown. Separately, and only in the criminal sphere, the FTA may agree a settlement with an alleged tax offender before a criminal case is referred to the Public Prosecution, in exchange for payment of the tax and penalties due (and, for certain offences, an additional settlement amount), which extinguishes the criminal case.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">If a taxpayer is concerned about how they are being treated, or the speed at which an audit is being conducted, do they have any remedies?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>The law confers a defined set of enforceable procedural rights on an audited taxpayer, including advance notice of the audit, the right to see the auditor&#8217;s identification, the right to attend an audit conducted away from the FTA&#8217;s premises, and the right to receive copies of documents seized, together with a right to request the material underlying the FTA&#8217;s findings once notified of the audit result.<\/p>\n<p>A taxpayer concerned about the manner or pace of an audit can raise the matter directly with the FTA, but the principal formal remedy remains downstream: challenging the resulting tax or administrative penalty assessment \u2013 and, within that challenge, raising any alleged procedural unfairness as part of the substantive dispute \u2013 through the statutory review, reconsideration, objection and appeal process.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">If a taxpayer disagrees with a tax assessment, do they have a right of appeal?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Yes, through a structured, multi-stage process. A taxpayer may first, optionally, submit a reasoned tax assessment review request to the FTA. It must then submit a reconsideration request to the FTA \u2013 a mandatory step irrespective of whether a review request was made. If still dissatisfied, it must object to the Tax Disputes Resolution Committee, again a mandatory precondition to any further recourse. Only once the Committee has issued (or is deemed to have refused) its decision may the taxpayer appeal to the competent court.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Is the right of appeal to an administrative body (independent or otherwise) or to a judicial body (i.e. a tribunal or court)?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Both, at successive stages. The Tax Disputes Resolution Committee, which must be approached before any court challenge, is best characterised as a body of quasi-judicial competence rather than a level of ordinary litigation. The UAE&#8217;s highest court has described it as a committee that hears the taxpayer&#8217;s grievance and exercises a form of judicial jurisdiction, applying civil procedure rules, while nonetheless sitting outside the regular court hierarchy. It is chaired by a member of the judiciary sitting together with two experts drawn from the register of tax experts.<\/p>\n<p>Once the Committee has issued its decision, its exceptional jurisdiction is exhausted and cannot be revived \u2013 any further recourse lies exclusively with the ordinary courts, beginning with the Court of First Instance.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Is the hearing in public? Is the decision published? What other information about the appeal can be accessed by a third party\/the public?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Proceedings before the Tax Disputes Resolution Committee are conducted on a written, case-file basis between the taxpayer and the FTA; they are not open to the public in the manner of a court hearing, and the Committee&#8217;s decisions are notified only to the parties rather than published. Once a dispute proceeds to the ordinary courts, general court procedure applies, and judgments of the higher courts (particularly the Federal Supreme Court) are, in practice, made available in redacted form and cited as precedent. First-instance and appellate proceedings themselves, however, are not conducted or reported in a way that gives the public routine visibility into individual tax disputes.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Is the procedure mainly written or a combination of written and oral?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>The process before the FTA (tax assessment review and reconsideration) and before the Tax Disputes Resolution Committee is conducted essentially on the papers \u2013 a reasoned written request or objection, considered and decided without a live oral hearing being a standard feature. Once a dispute reaches the ordinary courts, the general civil procedure regime applies, combining written pleadings with oral hearings and, where the issues are technical, the appointment of a court expert to examine and report on them.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Is there a document discovery process?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>There is no formal, wholesale disclosure process of the kind found in common law systems. A taxpayer does, however, have a specific statutory right to request the documents, data and information the FTA relied on in reaching its audit findings, subject to defined exclusions (such as the FTA&#8217;s internal correspondence and decisions, and confidential information belonging to other taxpayers). Beyond this, each party is generally expected to produce the evidence supporting its own case, and the courts have confirmed that new documentary evidence can even be introduced for the first time before the court, provided the other party has a fair opportunity to respond to it.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Are witnesses called to give evidence?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Tax disputes are conducted primarily on documentary and expert evidence rather than live witness testimony. The Tax Disputes Resolution Committee&#8217;s process is essentially a paper-based review, and before the courts, technical tax questions are typically resolved through a court-appointed expert&#8217;s report rather than witness examination. Live witnesses are not a common feature of tax appeals in practice, although the general procedural rules of the courts would not preclude their use where relevant.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Does the burden of proof rest with the taxpayer on an appeal against an assessment?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>It depends on the nature of the issue. In an ordinary administrative tax dispute, the burden of proving the correctness of a tax return rests on the taxpayer, consistent with the self-assessment nature of the UAE&#8217;s federal taxes. In a criminal tax evasion matter, by contrast, the burden of proof rests on the FTA (and ultimately the Public Prosecution), which must establish both the unlawful conduct and the taxpayer&#8217;s criminal intent.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">How long does an appeal usually take to conclude?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>The Tax Disputes Resolution Committee is required, as a general rule, to decide an objection within 20 business days of receipt (extendable), and to notify its decision within a further 5 business days. There is no equivalent timeframe for court proceedings, and, as with civil litigation generally in the UAE, a case proceeding through the Court of First Instance, Court of Appeal and Court of Cassation\/Federal Supreme Court can, depending on complexity and caseload, take in the order of a year or more to conclude.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Does the taxpayer have to pay the assessment pending the outcome of the appeal?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Largely yes, at each stage. Before an objection can be lodged with the Tax Disputes Resolution Committee, the taxpayer must have paid the disputed tax in full. Before any subsequent appeal to the competent court, the taxpayer must produce evidence of that same full payment of tax, together with evidence of payment of at least 50% of the administrative penalties determined by the Committee (or, at later appeal stages, by the court); failing either payment condition results in the appeal being dismissed as inadmissible.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Are there any restrictions on who may conduct or appear in the appeal on behalf of the taxpayer?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Before the FTA, only a tax agent formally registered with, and approved by, the FTA may act on a taxpayer&#8217;s behalf in its tax affairs \u2013 the FTA will not deal with any other adviser, consultant or attorney-in-fact purporting to represent the taxpayer, even under a specific power of attorney. This exclusivity, however, is limited strictly to dealings with the FTA and does not extend to legal representation in litigation: representation before the Tax Disputes Resolution Committee and the courts is generally a matter for licensed lawyers engaged in the ordinary way, rather than for tax agents.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Is there a cost-shifting system whereby the losing party pays the winning party\u2019s legal and professional costs of an appeal?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>UAE civil procedure gives the courts general discretion to order the unsuccessful party to bear litigation expenses such as court fees and expert fees, and this discretion applies to tax appeals as it does to civil and administrative litigation generally. It is not, however, a comprehensive &#8220;loser pays&#8221; costs regime of the kind found in some common law jurisdictions; any amount awarded in respect of the winning party&#8217;s legal representation costs tends in practice to be nominal rather than a full indemnity for the legal fees actually incurred.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Is it possible to use alternative forms of dispute resolution, such as voluntary mediation or binding arbitration? Are there any restrictions on when such alternative forms of dispute resolution may be pursued?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Genuine consensual alternative dispute resolution \u2013 voluntary mediation or binding arbitration in the conventional sense \u2013 is not generally available for tax disputes. The courts have confirmed that the relationship between the FTA and a taxpayer is a regulatory one governed by mandatory rules of law rather than a contractual relationship, which sits uneasily with arbitration as a consensual, contract-based mechanism.<\/p>\n<p>The closest analogues in the UAE regime are the mandatory objection to the Tax Disputes Resolution Committee (a form of structured administrative, rather than judicial, dispute resolution that must be exhausted before litigation) and the statutory settlement mechanism available in tax evasion cases before a criminal case is referred to the Public Prosecution \u2013 neither of which is voluntary ADR in the ordinary sense, and both of which apply only in the specific circumstances described above rather than being available by choice in any dispute.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Is there a right of onward appeal? If so, what are the levels of onward appeal before the case reaches the highest appellate court?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Yes. Beyond the Tax Disputes Resolution Committee, a dissatisfied party (the taxpayer or the FTA) may appeal to the competent Court of First Instance, then to the Court of Appeal, and finally to the Federal Supreme Court \u2013 generally three further levels of judicial recourse beyond the Committee.<\/p>\n<p>One significant limitation applies at the first stage as per the Tax Procedures Law: where the total tax and administrative penalties determined by the Committee&#8217;s decision do not exceed AED 100,000, that decision is final and cannot be appealed to the courts at all, regardless of which party would otherwise wish to appeal.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">What are the main penalties that can be applied when additional tax is charged? What are the minimum and maximum penalties?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Two distinct penalty regimes apply. Administrative penalties are fixed monetary fines set out in Cabinet Decisions for specific compliance failures (for example, failing to register, failing to file a return on time, or filing an incorrect return). They range from modest fixed amounts for certain notification failures up to fixed amounts such as AED 10,000 for failure to register, and some are calculated as a percentage of the tax involved (for example, late payment penalties) rather than as a fixed sum. Generally, each percentage-based penalty is capped to 200% of the underlying tax liability.<\/p>\n<p>Criminal penalties apply only to the specific tax crimes described above. Tax evasion carries imprisonment, a fine of 100% to 300% of the evaded tax, or both; deliberate non-payment of a due administrative penalty carries a comparable range of fine; and the remaining listed offences carry a fine of up to AED 1,000,000, imprisonment, or both, escalating to the evasion-level penalty where evasion in fact results from the conduct in question.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">If penalties can be mitigated, what factors are taken into account?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Administrative penalties (though not the underlying tax) may be waived in whole or in part, refunded, or made payable by instalments, on application to a dedicated three-member committee (chaired by the Chairman or Deputy Chairman of the FTA&#8217;s board, with two further board members), acting on a submission from the Director General and applying controls set out in a dedicated Cabinet Decision. The relevant considerations are essentially whether the taxpayer had an acceptable excuse for the underlying violation, and\/or a genuine inability to pay the penalties in one lump sum.<\/p>\n<p>Because administrative penalties are regulatory rather than criminal in character, principles specific to criminal sentencing \u2013 such as the retrospective application of a more lenient penal provision \u2013 do not apply to them; they continue to apply on an ongoing basis for as long as the relevant violation persists.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Within your jurisdiction, what areas do you think are most likely to be subject to challenge over the next 12 months?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Since Corporate Tax only began applying to tax periods starting on or after 1 June 2023, we expect disputes concerning its application to feature increasingly prominently as the FTA&#8217;s audit programme catches up with a tax that remains in the early years of its implementation \u2013 in particular, the qualification of Free Zone Persons for the 0% qualifying income regime, related-party and connected-person transactions and transfer pricing positions, and the tax treatment of restructurings undertaken by UAE groups in adjusting to the new regime.<\/p>\n<p>We would also expect continued audit activity in more established areas, particularly the Value Added Tax treatment of cross-border and digital supplies and real estate transactions, together with a steady flow of disputes concerning the calculation and imposition of administrative penalties \u2013 as opposed to the underlying tax \u2013 arising from registration, deregistration and filing delays.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">In your opinion, are there any areas that taxpayers are currently finding particularly difficult to deal with when faced with a challenge by the tax authorities?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>In our experience, taxpayers most often find the practical and documentary side of a challenge harder than the legal issues themselves. Because the UAE&#8217;s federal taxes operate on a self-assessment basis, a taxpayer defending its position must be able to produce, at short notice, the contemporaneous records and supporting documentation for the periods under audit. Businesses that have not maintained sufficiently granular records (particularly around intercompany transactions, Free Zone qualifying income, or VAT treatment of cross-border supplies) can find themselves at a disadvantage regardless of the underlying merits of their tax position.<\/p>\n<p>Corporate Tax also remains relatively new, having only applied to tax periods starting on or after 1 June 2023, so taxpayers and advisers are still building familiarity with how the FTA applies concepts such as qualifying income, related-party pricing, and legal reliefs in practice, and with the body of guidance and judicial precedent that continues to develop around them.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\r\n<div class=\"word-count-hidden\" style=\"display:none;\">Estimated word count: <span class=\"word-count\">4633<\/span><\/div>\r\n\r\n\t\t\t<\/ol>\r\n\r\n<script type=\"text\/javascript\" src=\"\/wp-content\/themes\/twentyseventeen\/src\/jquery\/components\/filter-guides.js\" async><\/script><\/div>"}},"_links":{"self":[{"href":"https:\/\/www.legal500.com\/guides\/wp-json\/wp\/v2\/comparative_guide\/150612","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.legal500.com\/guides\/wp-json\/wp\/v2\/comparative_guide"}],"about":[{"href":"https:\/\/www.legal500.com\/guides\/wp-json\/wp\/v2\/types\/comparative_guide"}],"wp:attachment":[{"href":"https:\/\/www.legal500.com\/guides\/wp-json\/wp\/v2\/media?parent=150612"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}