FTA Penalty Calculator
UAE 2026
Calculate your exact penalties for late filing, late payment, and wrong filing. Covers VAT and Corporate Tax under current UAE law.
Calculate Your PenaltiesCommon Penalty Scenarios
| Scenario | Tax Type | Details | Penalty, AED |
|---|---|---|---|
| Filed VAT return 2 months late | VAT | 1st offence, AED 25K tax, paid on filing date | 1,583 |
| Filed one VAT return 6 months late | VAT | Repeat offence, AED 50K tax, single period | 5,500 |
| Wrong filing — VAT (voluntary disclosure, 8 months) | VAT | AED 100K unpaid tax, 8 months | 17,833 |
| Same scenario — FTA audit | VAT | AED 100K unpaid tax, 8 months | 32,833 |
| CT return filed 15 months late | CT | AED 100K tax, paid on filing date | 26,500 |
| 10 non-compliant invoices | VAT | Missing TRN, incorrect amounts | 25,000 |
Figures are per return period. If you've missed multiple periods, the calculator totals each one separately — so the amount may be higher.
Understanding FTA Penalties
UAE Penalty Framework at a Glance
FTA penalties were reformed under Cabinet Decision No. 49 of 2021, with significant VAT amendments effective 14 April 2026. Current penalty categories:
- Late registration & filing — fixed fines from AED 1,000 to AED 10,000, plus late payment interest at 14% per annum (both VAT and CT). CT also adds AED 500–1,000/month filing penalties.
- Wrong filing — depends on how the error is found. FTA audit: 15% of the unpaid tax amount + 1%/month. Voluntary disclosure: 1%/month only (no 15%). Late payment interest at 14% p.a. accrues on top.
- Non-compliant documents — AED 2,500 per invoice or credit note that fails FTA requirements (missing TRN, incorrect amounts, unsigned)
Think Your Tax Return Might Have Errors?
Most wrong-filing penalties come from mistakes you don't spot until it's too late. Common culprits:
- Personal expenses booked as business costs
- Missing or non-compliant invoices
- Incorrect VAT treatment
- Motor vehicle input VAT claims
The penalty grows at 1% per month — and if the FTA finds the error first, they add a 15% fixed penalty on top.
Voluntary disclosure removes the 15% entirely. On AED 100K of unpaid tax, that's AED 15,000 you keep. Use our Tax Helper to estimate your exposure in minutes.
Frequently Asked Questions
What happens if I file my VAT return late?
A fixed penalty of AED 1,000 applies for the first offence. If you file late again within 24 months, the penalty doubles to AED 2,000. In addition, late payment interest accrues at 14% per annum on any unpaid tax, calculated monthly.
What is a Voluntary Disclosure and why should I file one?
A Voluntary Disclosure is when you self-report an error in a previous tax return before the FTA discovers it. The penalty for voluntary disclosure is significantly lower than if the FTA finds the error during an audit. Voluntary disclosure costs AED 500 + 1% per month on the tax difference, while an FTA audit adds a 15% fixed penalty on top. The earlier you disclose, the fewer months accrue.
How are Corporate Tax late filing penalties calculated?
CT late filing penalties are AED 500 per month (or part thereof) for the first 12 months, increasing to AED 1,000 per month from month 13 onwards. Late payment interest accrues at 14% per annum on any outstanding tax amount.
Is there a cap on late payment penalties?
For both VAT and Corporate Tax, late payment interest accrues at 14% per annum. There is no published cap — the total accrual is limited only by the time period until payment.
Can I appeal an FTA penalty?
Yes. The process has three stages: first, submit a Penalty Waiver Application to the FTA requesting a reduction or waiver. If denied, file a Penalty Reconsideration Request within 40 business days. If the FTA still upholds the penalty, you may escalate to the Tax Disputes Resolution Committee (TDRC) within 40 business days of the FTA's reconsideration decision.
Need help with penalties?
Our team helps UAE businesses file voluntary disclosures and reduce penalty exposure every day.