Businesses operating in the UAE must carefully follow Federal Tax Authority (FTA) rules to avoid heavy VAT fines in UAE. In 2025, the FTA continues to enforce strict administrative penalties UAE VAT, covering late filings, late payments, incorrect records, and more.
These FTA fines and penalties are designed to ensure compliance and fair tax practices. Depending on the violation, fines may range from AED 1,000 to 300% of the unpaid tax.
This guide explains the latest UAE VAT penalties (2025 update), common violations, and best practices to avoid fines.
Some businesses may be able to request a VAT penalty waiver UAE if fines resulted from genuine mistakes or exceptional circumstances. However, approval is at the sole discretion of the FTA, and valid documentation must be submitted.
In 2025, the FTA has also introduced certain corporate tax penalty waivers (not VAT), showing that relief measures are expanding across different tax types.
The UAE VAT penalties 2025 make it clear that compliance is non-negotiable. Fines can quickly add up, from small mistakes like missed invoices to major violations in designated zones.
If you’ve already received a Dubai VAT fine or want expert guidance to stay compliant, reach out to an FTA-approved tax agent. At Unicorn Global Solutions, we help businesses file VAT returns correctly, avoid penalties, and even apply for a VAT penalty waiver UAE when possible. Unicorn Global Solutions is here to help! Text us on whatsApp or call us today .
Disclaimer: This article is for general information only and should not be considered official tax advice. For the latest updates and personalized guidance, please consult the UAE Federal Tax Authority (FTA) or an FTA-approved tax agent.
If VAT is not paid on time, the VAT late payment penalty UAE applies: 2% of unpaid tax immediately, 4% after one week, plus 1% monthly up to 300%.
The fine is AED 1,000 for the first late VAT return, and AED 2,000 if repeated within 24 months.
Yes. In some cases, businesses can request a VAT penalty waiver UAE if the non-compliance was due to genuine errors or unavoidable circumstances.
The Dubai VAT fine for failing to issue a tax invoice or credit note is AED 2,500 per missing or incorrect document.
The Administrative penalties UAE VAT include fines for not keeping records (AED 10,000+), not registering on time, and not facilitating FTA audits (AED 20,000).
