UAE Federal Tax Authority Announces Grace Period for Updating Business Tax Records7 min read
- 06.02.2025
- Posted by: Malavika Kolera
- Categories: Dubai, Tax
The UAE Federal Tax Authority (FTA) announced a relief measure for businesses with a grace period for tax record updates without penalties. The initiative runs from 01.01.2024 to 31.03.2025, showing how the UAE government aims to support businesses and keep the country attractive for companies.
What Does This Mean for Your Business?
First, let’s talk about existing penalties. If your business received any penalties from 01.01.2024 until the implementation of the grace days decision for not updating your tax information, these will be cleared. The best part is that you don’t need to do anything – the FTA will remove these penalties automatically without you having to contact them or file any paperwork.
Looking ahead, you now have protection from new penalties until 31.03.2025. This means you can update your tax information during this period without worrying about getting penalized for late updates. The UAE government has created this window to help you bring all your records up to date without the stress of potential fines.
This relief applies to every business registered with the FTA. Whether you’re an established company or newly registered, whether you’ve already received penalties or have been hesitant to update your information because of potential penalties – this grace period is for you. It’s essentially a fresh start, giving you the chance to get your tax records in order without financial consequences. The government understands that businesses need support, and this is their way of making it easier for you to stay compliant with tax regulations.
However, it’s important to note that this grace period is not related to late registration for Corporate Income Tax (CIT).
Information That Needs to be Updated
According to Cabinet Decision No. 74 of 2023, businesses must notify the FTA of any changes to their data, including:
- Business name
- Registered email address
- Trade license activities
- Legal entity type
- Partnership agreements for unincorporated partnerships and articles of association or its equivalent
- Nature of business
- Business operating addresses
The notification must be made within twenty (20) business days of any change using the FTA-approved form and mechanism.
Why This Matters for UAE Businesses?
This initiative shows how the UAE government actively supports its business community. The government recognizes that in today’s market, every dirham saved strengthens your business. By reducing the tax burden through this grace period, they’re helping you keep more resources for what matters: growing your business, upgrading your operations, or expanding your services.
Moreover, this business-friendly approach adds to the UAE’s strength as a global business center. For companies, this means operating in a market that actively works to help businesses succeed. Whether you’re running a small local business or part of a larger international company, these initiatives make it easier to succeed. It’s one of the key reasons why Dubai and the UAE continue to attract businesses worldwide, creating new opportunities for partnerships, customers, and growth for companies like yours.
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