The Federal Tax Authority (FTA) has announced that businesses must complete Corporate Tax registration within 90 days from the Date of Incorporation / MOA.
VAT compliance in the UAE is governed by strict filing and payment rules, and even a small delay or administrative oversight can result in penalties imposed by the Federal Tax Authority (FTA). Businesses commonly face penalties due to late VAT return submissions, payment delays, or technical errors during filing. To address such situations, the FTA allows taxable persons to request a review of penalties through UAE VAT Reconsideration. By submitting VAT Reconsideration Requests for Penalty Waiver, businesses can formally challenge penalties or seek discretionary relief where genuine or exceptional circumstances exist, often with the support of professional VAT Services.
What Is a VAT Reconsideration Request?
A VAT Reconsideration is a formal legal mechanism that allows a taxable person to request the FTA to review a decision it has issued, including VAT penalties.
Key aspects of a VAT Reconsideration Request include:
- It is governed under the UAE Tax Procedures Law, ensuring due process and fairness.
- The request must be submitted exclusively through the EmaraTax portal.
- It can be filed by the taxable person, an appointed tax agent, or a legally authorized representative.
The reconsideration must always relate to a specific FTA decision and cannot be used for general objections or informal disputes.
Difference Between VAT Reconsideration and Penalty Waiver
Although often used together, VAT Reconsideration and penalty waiver serve different purposes.
- VAT Reconsideration focuses on whether the FTA’s original decision was correct or justified. It reviews the facts, compliance history, and circumstances surrounding the penalty.
- Penalty Waiver is a discretionary relief granted by the FTA even when the penalty is technically valid. It is applied in situations involving genuine mistakes, system issues, or exceptional circumstances beyond the taxpayer’s control.
A VAT Reconsideration Request for Penalty Waiver is typically submitted when penalties arise despite reasonable compliance efforts.
Who Can Apply for a UAE VAT Reconsideration Request?
The FTA allows the following parties to submit a UAE VAT Reconsideration Request:
- VAT-registered businesses that have received administrative penalties or assessments
- Individuals who have been penalized under VAT regulations
- Authorized tax agents acting on behalf of taxable persons
The request must relate to a specific FTA decision, such as late filing penalties, payment penalties, VAT assessments, or deregistration outcomes.
Timeframe to Submit a VAT Reconsideration Request
The timeline for submission is strictly enforced by the FTA.
- VAT Reconsideration Requests must be submitted within 40 business days from the date the taxable person is notified of the FTA decision.
- Requests submitted after this deadline are automatically rejected by the system.
This timeframe is commonly misunderstood, making early action critical to preserve the right to reconsideration.
How to Submit a VAT Reconsideration Request via EmaraTax
The submission process is conducted entirely online through EmaraTax and involves the following steps:
- Log in to the EmaraTax portal using registered credentials.
- Select the Reconsideration Request option from the services menu.
- Choose the relevant VAT penalty or FTA decision.
- Upload supporting documents such as emails, compliance records, or proof of technical errors.
- Review all details carefully before submitting the application.
Well-prepared supporting evidence significantly strengthens the chances of approval.
FTA Review Process and Expected Decision Timeline
Once submitted, the FTA reviews the VAT Reconsideration Request within 45 business days.
- The review period may be extended if additional clarification or documentation is required.
- The final decision is communicated through the EmaraTax system.
What Happens If the Reconsideration Is Rejected?
If the FTA rejects the reconsideration request, the taxable person may escalate the matter.
- An appeal can be filed with the Tax Dispute Resolution Committee (TDRC).
- If necessary, further judicial appeal options are available under UAE tax laws.
This escalation pathway ensures taxpayers are not left without recourse.
Conclusion
Submitting a timely and well-documented UAE VAT Reconsideration is essential for businesses seeking relief from VAT penalties. Clear justification and strong evidence play a decisive role in the success of VAT Reconsideration Requests for Penalty Waiver. Working with experienced tax professionals such as Reyson Badger helps ensure accuracy, compliance, and a higher likelihood of favorable outcomes across VAT Registration and VAT Services.
