Key takeaways
- A UAE business that files a VAT return after the deadline pays a fixed administrative penalty of AED 1,000 for the first late filing and AED 2,000 for a repeat within 24 months (Cabinet Decision No. 40 of 2017 as amended by Cabinet Decision No. 129 of 2025, as of November 2026).
- The UAE VAT return deadline is the 28th day after the end of the tax period, and any VAT payable is due by the same day, so a late return and a late payment are two separate penalty risks.
- Unpaid VAT has attracted a penalty of 14% per annum, charged for each month or part of a month, since 14 April 2026; the amended penalty table states no cap.
- A VAT-registered company with no transactions in a tax period still has to file a nil VAT return by the deadline.
- A VAT registrant that never files can face an FTA assessment based on an estimate of the tax payable, according to the FTA's VAT returns user guide.
- A late VAT penalty can be disputed through a reconsideration request within 40 business days, or reduced through a waiver request, but only after the FTA has issued a decision imposing it.
What is the penalty for filing a UAE VAT return late?
The FTA charges a fixed AED 1,000 for the first late VAT return and AED 2,000 for each repeat within 24 months. The amounts sit in Table 1 of Cabinet Decision No. 40 of 2017 on administrative penalties, as amended by Cabinet Decision No. 129 of 2025, which has applied since 14 April 2026.
| Violation | First time | Repeat within 24 months | Where it's set |
|---|---|---|---|
| Failure to submit the VAT return within the timeframe in the tax law | AED 1,000 | AED 2,000 | Cabinet Decision No. 40 of 2017, Table 1, item 8 |
The penalty is a fixed amount per violation, not a percentage of tax, so a return showing AED 5,000 of VAT due costs the same to file late as one showing AED 500,000. The FTA's 2021 VAT returns user guide listed the same two amounts, so the April 2026 reform changed how late payment is charged, not the filing penalty.
Say a SHAMS trading company files three days late, then misses another deadline eleven months later: the first miss costs AED 1,000 and the second AED 2,000.
When is a UAE VAT return considered late?
A VAT return is late if the FTA hasn't received it by the 28th day after the end of the tax period. When that day falls on a weekend or public holiday, the deadline moves to the next business day, according to the FTA's VAT returns user guide.
| Business | Standard tax period | Source |
|---|---|---|
| Annual turnover below AED 150 million | Quarterly | u.ae, File VAT returns |
| Annual turnover of AED 150 million or more | Monthly | u.ae, File VAT returns |
| Certain business types | A period assigned by the FTA | u.ae, File VAT returns |
Payment follows the same clock: where VAT is payable, the FTA must receive it by the return deadline. Returns are filed electronically on EmaraTax.
If you'd rather not track these dates by hand, the free UAE compliance calendar lists them for your company: a free calendar of your company's UAE tax and compliance deadlines, personalised from a few questions, as a PDF and calendar file.
What happens if I pay the VAT late as well?
Late payment is penalised separately from late filing. Since 14 April 2026, unsettled VAT attracts a penalty at 14% per annum, charged for each month or part of a month, starting the day after the due date and repeating on the same date every month.
| Element | Rule | Source |
|---|---|---|
| Rate | 14% per annum, charged monthly for each month or part of a month | Cabinet Decision No. 40 of 2017, Table 1, item 9 |
| Start | The day after the payment due date | Same |
| Repeats | On the same date each month until the tax is settled | Same |
| Charged on | The unsettled tax | Same |
| Cap | Not stated in the penalty table | Same |
Because the wording runs by "month or part thereof", a payment one day late already starts a full month's charge on a plain reading. The table doesn't spell out a monthly percentage, so rely on the amount in your FTA penalty notice.
What happens if I don't file the VAT return at all?
The FTA can assess the tax itself. Its VAT returns user guide says that if no return is filed, the FTA may issue a tax assessment based on an estimate of the tax payable. The guide is the 2021 edition, so confirm the current position with the FTA.
What should I do right after missing the VAT deadline?
File the return and pay what's due as soon as you can, because the late-payment charge keeps running until the tax is settled.
- Gather the period's sales and purchase records and complete the VAT201 return on EmaraTax, using your UAE Pass login. File a nil return if the period had no transactions.
- Pay any VAT due by GIBAN bank transfer, including the unique payment reference number the FTA generates, or by Visa or Mastercard through MagnatiPay. Banks reject GIBAN payments with incorrect details, and the FTA no longer accepts eDirham.
- Check EmaraTax for the FTA's penalty decision, because the reconsideration, waiver and instalment services all apply to a decision the FTA has issued.
- If you think the penalty is wrong, for instance because the return was received before the deadline, submit a reconsideration request on EmaraTax.
- If the penalty is correct but you have grounds for relief, submit a waiver request on EmaraTax with an undertaking that the violation has been corrected and won't be repeated.
Can a late VAT penalty be challenged or waived?
Yes, through separate routes: a reconsideration request if you think the FTA's decision is wrong, and a waiver request if the penalty is correct but you're asking for relief. Both are submitted on EmaraTax and are free.
| Route | Use it when | Deadline | FTA response time | Source |
|---|---|---|---|---|
| Reconsideration request | You dispute the FTA's decision | 40 business days from the FTA's decision | Up to 45 business days from a complete request; the FTA may extend | FTA, Reconsideration Request |
| Penalty waiver request | The penalty stands but you want it waived under Cabinet Decision No. 105 of 2021 | Not stated on the FTA service page | Up to 110 business days from a complete request | FTA, Requests for Installment, Waiver, and Refund |
| Instalment plan | Unsettled penalties total at least AED 50,000, with no tax owed for that period | Not stated on the FTA service page | Up to 110 business days from a complete request | FTA, Requests for Installment, Waiver, and Refund |
If the reconsideration is rejected, the decision can be taken to the Tax Dispute Resolution Committee at the Department of Justice, according to the FTA.
AED 1,000: the penalty for a first late VAT return, rising to AED 2,000 for a repeat within 24 months. Source: Cabinet Decision No. 40 of 2017 as amended (FTA consolidated text, Table 1 item 8), checked 07 November 2026.
What most guides don't tell you
- Filing on time doesn't protect you from the payment penalty, and paying on time doesn't cancel the filing penalty. The two are separate items in the same penalty table, so paying on day 27 and filing on day 30 still costs AED 1,000.
- A small VAT penalty can't be spread over instalments. The FTA's instalment service requires unsettled penalties of at least AED 50,000 (a threshold the Committee can change), so a single AED 1,000 or AED 2,000 filing penalty is a pay-or-challenge decision.
- The reconsideration deadline is counted two ways on the FTA's own page. The terms say 40 business days from the date of the original decision; the FAQ says 40 working days from notification. Count from the earlier date, because a missed deadline can't be argued back.
- Tax that fell due before 14 April 2026 sits in a grey zone. Cabinet Decision No. 129 of 2025 has no explicit transitional rule for it, and we found no FTA clarification as of 07 November 2026 on whether the new late-payment rate applies to older liabilities. If you owe VAT from before that date, ask the FTA or a registered tax agent how your penalty has been calculated.
Which VAT deadlines apply to your company?
The free UAE compliance calendar lists the tax and compliance dates for your company, personalised from a few questions.
Frequently asked questions
How often do I need to file VAT returns in the UAE? Most businesses file quarterly; businesses with annual turnover of AED 150 million or more file monthly, and the FTA can assign a different period to certain business types. The period the FTA assigned to you at registration is the one that counts.
How do I file a VAT return on EmaraTax? Log in to EmaraTax with UAE Pass, open the VAT201 return, complete every mandatory field, tick the declaration and submit. The FTA's VAT returns user guide (2021 edition) describes saving a draft first and a confirmation email after submission, so menu names may differ slightly today.
When is the VAT return deadline? The FTA must receive the return by the 28th day after the end of the tax period, and a deadline falling on a weekend or holiday moves to the next business day. Any VAT payable is due by the same date.
What is the penalty for late VAT payment? Since 14 April 2026, the penalty is 14% per annum on the unsettled tax, charged for each month or part of a month from the day after the due date. The penalty table states no cap, so check your FTA penalty notice for the exact amount.
About Qawi · Qawi is a corporate services firm licensed in the Sharjah Media City (SHAMS) free zone, handling company formation, visas and PRO, bookkeeping, VAT and corporate tax for UAE businesses. Guides are researched from FTA, Ministry of Finance and free zone sources. Qawi on LinkedIn
Sources
- Cabinet Decision No. 40 of 2017 and its amendments, consolidated text incorporating Cabinet Decision No. 129 of 2025 (FTA)
- File VAT returns (u.ae)
- VAT Returns User Guide, 2021 edition (FTA)
- EmaraTax: Submit tax returns and pay (FTA)
- Reconsideration Request (FTA)
- Requests for Installment, Waiver, and Refund of Administrative Penalties (FTA)
- UAE Ministry of Finance updates the Tax Procedures and Administrative Penalties as per April 2026 (Deloitte Middle East, used to cross-check the April 2026 reform, not as a primary source)
Last checked: 07 November 2026
This is general information, not tax or legal advice for your specific situation.