What is the penalty for not keeping tax records?

Table No. 1 On Violations and Administrative Penalties related to the Implementation of Federal Law No. 7 of 2017 on Tax Procedures No. Description of Violation Administrative Penalty in AED 1 The failure of the Person conducting 10,000 for the first time. Business to keep the required 20,000 in case of repetition. records and other information specified in the Tax Procedures Law and the Tax Law. 2 The failure of the Person conducting 20,000 Business to submit the data, records, and documents related to Tax in Arabic to the Authority when requested. 3 The failure of the Taxable Person to 10,000 submit a registration application within the timeframe specified in the Tax Law. 4 The failure of the Registrant to 1,000 in case of delay, and on the same submit a deregistration application date monthly thereafter, up to a maximum within the timeframe specified in of 10,000. the Tax Law. 5 The failure of the Registrant to 5,000 for the first time. inform the Authority of any 10,000 in case of repetition. circumstance that requires the amendment of the information pertaining to its Tax record kept by Authority. 6 The failure of the Legal 10,000 Representative of the Taxable Person to inform the Authority of its appointment as Legal Representative within the specified timeframe, in which case the Penalties will be due from the Legal Representative’s own funds. Cabinet Decision No. 49 of 2021 - Issue Date: 28 April 2021 - Unofficial Translation 2

الغرامات اإلدارية:)1( الجزء Part 1: Administrative Penalties (1) جدول رقم Table No. 1 On Violations and Administrative Penalties related to the Implementation of Federal Law No. 7 of 2017 on Tax Procedures بشأن المخالفات والغرامات اإلدارية المتعلقة بتطبيق في شأن اإلجراءات الضريبية2017 ) لسنة7( القانون االتحادي رقم No. Description Penalty (AED) الغرامة الوصف م 1 The failure of the Person conducting Business to keep the required records and other information specified in the Tax Procedures Law and the Tax Law. 10,000 for the first time. 20,000 in case of repetition. ( عن المرة10,000) عدم قيام الشخص الذي يمارس األعمال بحفظ السجالت المطلوبة وغيرها من المعلومات المحددة في قانون اإلجراءات الضريبية والقانون .الضريبي 1 .األولى ) في حالة20,000( .التكرار *تم تخفيضها *Reduced 2 The failure of the Person conducting Business to submit the data, records, and documents related to Tax in Arabic to the Authority when requested. )20,000( 20,000 عدم قيام الشخص الذي يمارس األعمال بتقديم البيانات والسجالت والمستندات المتعلقة بالضريبة باللغة .العربية إلى الهيئة عند الطلب 2 *لم يتم تعديلها *Not amended 3 The failure of the Taxable Person to submit a registration application within the timeframe specified in the Tax Law. 10,000 (10,000) عدم قيام الخاضع للضريبة بتقديم طلب التسجيل خالل المهلة المحددة .بالقانون الضريبي 3 *تم تخفيضها *Reduced 4 The failure of the Registrant to submit a deregistration application within the timeframe specified in the Tax Law. 1,000 in case of delay, and on the same date monthly thereafter, up to a maximum of 10,000. ) عند التأخر1,000( 5,000 for the first time. 10,000 in case of repetition. ( عن المرة5,000) بتقديم الطلب وبذات وبحد،التاريخ شهريا .)10,000( أقصى عدم قيام المسجل بتقديم طلب إلغاء التسجيل خالل المهلة المحددة .بالقانون الضريبي 4 *تم شرح اآللية الجديدة أدناه *New mechanism explained below 5 The failure of the Registrant to inform the Authority of any circumstance that requires the amendment of the information pertaining to its Tax record kept by Authority. .األولى ) في حالة10,000( .التكرار عدم قيام المسجل بإبالغ الهيئة بأي حالة قد تتطلب تعديل المعلومات الخاصة بسجله الضريبي المحفوظ .لدى الهيئة *تم تخفيضها *Reduced 4/26 5

Article 56 – Record Keeping 1. Notwithstanding the provisions of the Tax Procedures Law, a Taxable Person shall maintain all records and documents for a period of (7) seven years following the end of the Tax Period to which they relate that: a. Support the information to be provided in a Tax Return or in any other document to be filed with the Authority. b. Enable the Taxable Person’s Taxable Income to be readily ascertained by the Authority. 2. Notwithstanding the provisions of the Tax Procedures Law, an Exempt Person shall maintain all records that enable the Exempt Person’s status to be readily ascertained by the Authority for a period of (7) seven years following the end of the Tax Period to which they relate.

Article (14) The Making and Keeping of Records and Books of Account 1. Persons Obliged to Pay Tax are required to keep regular and independent accounting books and records to record the movement of Excise Goods, as well as supporting documents, and to maintain them in an organized and logical manner, making it possible for the Tax Authority to monitor the accuracy of tax calculation and payment. 2. Accounting books and records and supporting documents shall be retained for a period of five years from the end of the fiscal year during which that operation took place, unless they are required to be retained for a longer period under any of the laws in force in each Member State.