What is the penalty for errors in a VAT return?

Article 24 – Administrative Penalties Assessment10 1. The Authority shall issue an Administrative Penalties Assessment for the Person and notify him of the Administrative Penalties Assessment within (5) five Business Days for any of the following violations: a. The Person conducting Business or having an obligation under this Decree-Law or the Tax Law failing to keep the required records and other information specified in this Decree-Law and the Tax Law. b. The Person conducting Business or having an obligation under this Decree-Law or the Tax Law failing to submit the data, records and documents related to Tax in Arabic to the Authority when requested. c. The Taxable Person failing to submit a Tax Registration application within the timeframe specified in the Tax Law. d. The Registrant failing to submit a deregistration application within the timeframe specified in the Tax Law. e. The Registrant failing to inform the Authority of any case that requires the amendment of the information pertaining to his Tax record kept by the Authority. f. The Legal Representative failing to inform the Authority of his appointment within the specified timeframe, in which case the penalties will be due from the Legal Representative’s own funds. g. The Legal Representative failing to file a Tax Return within the specified timeframe, in which case the penalties will be due from the Legal 10 Article Amended as per Federal Decree-Law No. 17 of 2024. Federal Decree-Law No. 28 of 2022 and its amendments – As published by the Ministry of Finance 14 Representative’s own funds. h. The Registrant failing to submit the Tax Return within the timeframe specified in the Tax Law. i. The Taxable Person failing to settle the Payable Tax within the timeframe specified in the Tax Law. j. The Registrant submitting an incorrect Tax Return. k. The Taxable Person or the Taxpayer submits a Voluntary Disclosure in relation to errors in the Tax Return or the Tax Assessment or refund application pursuant to Clauses 1 and 2 of Article 10 of this Decree-Law. l. The Taxable Person or the Taxpayer fails to submit a Voluntary Disclosure in relation to errors in the Tax Return or the Tax Assessment or refund application pursuant to Clauses 1 and 2 of Article 10 of this Decree-Law before being notified that he will be subject to a Tax Audit. m. The Person subject to Tax Audit, his Tax Agent or Legal Representative failing to offer facilitation to the Tax Auditor in violation of the provisions of Article 20 of this Decree-Law, in which case the penalties will be due from the Person’s, Tax Agent’s or Legal Representative’s own funds as applicable. n. The Registrant failing to account for Tax on behalf of another Person when the registered Taxable Person is obligated to do so under the Tax Law. o. Any other violation specified under the Tax Law or a Cabinet decision. 2. The Executive Regulation shall specify the information and data that must be included in the Administrative Penalties Assessment. 3. The Cabinet shall issue a decision that specifies the Administrative Penalties for each of the violations listed in Clause 1 of this Article in respect of this Decree-Law, the Tax Law or any other violation specified under a Cabinet decision. 4. The amount of any Administrative Penalty shall not exceed two times the amount of Tax in respect of which the Administrative Penalties Assessment was issued. 5. The imposition of any Administrative Penalty pursuant to the provisions of this Decree-Law or any other law shall not exempt any Person from the responsibility of settling the Payable Tax in accordance with the provisions of this Decree-Law or the Tax Law. Federal Decree-Law No. 28 of 2022 and its amendments – As published by the Ministry of Finance 15 Chapter Five – Penalties, Procedures and Measures

Article 10 1. If a Taxable Person becomes aware that a Tax Return submitted to the Authority or a Tax Assessment issued by the Authority is incorrect, which resulted in a calculation of Payable Tax according to the Tax Law being less than it should have been, the Taxable Person shall submit a Voluntary Disclosure. 2. If a Taxpayer becomes aware that a Tax refund application submitted to the Authority is incorrect, which resulted in the calculation of a refund amount to which he is entitled according to the Tax Law being more than it should have been, 8 Clause amended as per Federal Decree-Law No. 17 of 2025. Federal Decree-Law No. 28 of 2022 and its amendments – As published by the Ministry of Finance 8 the Taxpayer shall submit a Voluntary Disclosure. 3. If a Taxable Person becomes aware that a Tax Return submitted to the Authority or a Tax Assessment issued by the Authority is incorrect, which resulted in the calculation of Payable Tax according to the Tax Law being more than it should have been, the Taxable Person may submit a Voluntary Disclosure. 4. If a Taxpayer becomes aware that a Tax refund application submitted to the Authority is incorrect, which resulted in the calculation of a refund amount to which he is entitled according to the Tax Law being less than it should have been, the Taxpayer may submit a Voluntary Disclosure. 5. If the Taxpayer discovers an error or omission in the Tax Return submitted to the Authority, where there is no difference in the amount of Due Tax, the Taxpayer must correct such error by submitting a Voluntary Disclosure in the cases specified by the Authority, or correct such error via a Tax Return in any other case.9 6. The Executive Regulation shall set out the detailed provisions relating to submitting a Voluntary Disclosure to the Authority and the method of application of Administrative Penalties imposed prior to the Voluntary Disclosure. Title Three – Tax Procedures Chapter One – Notification

The amounts of VAT charged by the taxable person and input tax recoverable by the person would then need to be netted off in the tax return. The resulting amount is the net VAT payable to, or to be refunded by, the FTA. 11.3.1. Due date for submitting tax returns The due date for submitting tax returns and making a payment of payable tax to the FTA is the 28th day following the end of the tax period to which the tax return relates. It should be noted that where a payment is due to the FTA, it must be received by the FTA by the deadline. Where the due date for the submission of the tax return and the corresponding payment falls on a weekend or a national holiday, the deadline for filing the tax return or making a payment is extended to the first working day following this. Submitting a tax return or making a payment of tax late will result in a penalty levied by the FTA. All tax returns should be submitted online using the FTA portal. The return can be submitted by the taxable person, or another person who has the right to do so on the taxable person’s behalf (for example, a tax agent or a legal representative). 11.3.2. Correcting errors Where a taxable person has made an error (for example, calculated output tax incorrectly or recovered the incorrect amount of input tax), then the person is required to correct this error. Where the correction is required in respect of a tax return or a tax assessment, and the total value of the error is less than AED 10,000, the taxable person may correct the error on the tax return for the tax period in which the error was discovered. In all other cases, the taxable person must disclose the error to the FTA within 20 business days of becoming aware of the error, and request the FTA to correct the error. By making a voluntary disclosure the taxable person may be eligible for a reduction in any applicable penalty. However, where a voluntary disclosure is submitted to the FTA after the taxable person has received notice of a tax audit or while a tax audit in in progress, the voluntary disclosure will either reduce penalties to some extent or not at all. 44 VAT Guide | Taxable Person | VATG001

VAT Return The progress bar displays the number of steps required to complete the VAT VD. The step you are currently in is highlighted in blue. Once you progress to the next section successfully, the previous step will be highlighted in green. You are required to submit a Voluntary Disclosure if you have made an error that is in excess of AED 10,000 or any negative value. Federal Tax Authority Submit VAT Voluntary Disclosure by VAT Registrant - Taxpayer User Manual Page 16