If your business has received an FTA penalty notice — whether for late VAT filing, missed Corporate Tax registration, incorrect returns, or other compliance failures — there may still be a way to get the fine reduced or waived entirely.
The Federal Tax Authority (FTA) provides multiple penalty relief mechanisms under UAE tax law. This guide covers all types of FTA fines, how the waiver process works, eligibility conditions, and practical steps to remove penalties from your account.
Types of FTA Penalties That Can Be Waived
The FTA imposes administrative penalties for various compliance failures. The following penalties may be eligible for relief:
VAT Penalties
- Late VAT registration — AED 10,000
- Late VAT return filing — AED 1,000 first offence, AED 2,000 repeat within 24 months
- Late VAT payment — 2% immediately + 4% on day 7 + 1% daily (capped at 300%)
- Failure to issue tax invoice — AED 2,500 first offence, AED 5,000 repeat
- Failure to keep records — AED 10,000 first offence, AED 20,000 repeat
Corporate Tax Penalties
- Late Corporate Tax registration — AED 10,000
- Failure to file Corporate Tax return — AED 10,000
- Late filing of Corporate Tax return — AED 500 per month (up to AED 10,000)
- Late payment of Corporate Tax — 14% per annum on outstanding amount
How the FTA Penalty Waiver Process Works
Option 1: Automatic Waiver for Late Corporate Tax Registration
Under the FTA’s penalty waiver initiative for Corporate Tax, your late registration penalty can be automatically waived if you:
- Complete your Corporate Tax registration (even if late)
- File your first Corporate Tax return or exempt person declaration within 7 months of the end of your first tax period
If you already paid the AED 10,000 penalty and qualify, the amount will be credited back to your EmaraTax account.
Option 2: Penalty Reconsideration Request
For all other FTA penalties (VAT and Corporate Tax), you can submit a reconsideration request through the EmaraTax portal:
- Log in to your EmaraTax account
- Navigate to the penalty notice under your tax obligations
- Click “Request Reconsideration”
- Provide a detailed explanation of why the penalty should be reduced or waived
- Attach supporting documents (correspondence, proof of reasonable cause, evidence of correction)
- Submit within 40 business days of the penalty decision
The FTA reviews each case individually. Common grounds for successful reconsideration include:
- Technical system errors that prevented timely filing
- Reasonable cause and good faith (first-time offence with prompt correction)
- Incorrect penalty calculation by the FTA
- Circumstances beyond the taxpayer’s control
Option 3: Tax Disputes Resolution Committee (TDRC)
If your reconsideration request is rejected, you can escalate to the Tax Disputes Resolution Committee within 40 business days of the FTA’s reconsideration decision. This is a formal appeals process with independent review.
Step-by-Step: How to Apply for FTA Fine Waiver
- Identify the penalty — Check your EmaraTax dashboard for all active penalties
- Correct the violation — File overdue returns, complete registration, or fix errors before applying
- Gather evidence — Collect documents supporting your case (system screenshots, bank records, correspondence)
- Submit reconsideration — File through EmaraTax within the 40-business-day window
- Follow up — Monitor your application status on the portal
- Escalate if needed — If rejected, file with the TDRC within 40 business days
Frequently Asked Questions
Can I Get an FTA Fine Waived in UAE?
Yes. The FTA provides multiple penalty relief options including automatic waivers for Corporate Tax late registration (if you file your first return within 7 months), penalty reconsideration requests for all tax types, and escalation to the Tax Disputes Resolution Committee if needed.
How Long Do I Have to Request FTA Penalty Reconsideration?
You must submit your reconsideration request within 40 business days from the date you were notified of the penalty decision. Missing this deadline means you lose the right to have the penalty reviewed.
What Happens If My Reconsideration Is Rejected?
You can escalate to the Tax Disputes Resolution Committee (TDRC) within 40 business days of the FTA’s reconsideration decision. The TDRC provides an independent review of your case.
Can VAT Late Payment Penalties Be Waived?
VAT late payment penalties can be reduced through the reconsideration process if you demonstrate reasonable cause. However, the FTA is strict on payment deadlines. The best approach is to pay the tax amount first (to stop daily penalties accumulating) and then request reconsideration on the penalty amount.
Do I Need a Tax Agent to Apply for Penalty Waiver?
No, you can submit reconsideration requests directly through EmaraTax. However, engaging a professional tax consultant like Qaspro Global significantly increases your chances of success. We know how to frame the case and provide the documentation the FTA expects.
How Qaspro Global Can Help Remove Your FTA Fines
At Qaspro Global, we have helped numerous UAE businesses successfully remove or reduce FTA penalties. Our services include:
- Penalty review and assessment — we evaluate all your active penalties and identify waiver eligibility
- Reconsideration request preparation — we draft compelling applications with proper documentation
- TDRC escalation support — we handle the appeals process if reconsideration is rejected
- Compliance correction — we fix the underlying issues (late returns, registration gaps) to prevent future penalties
- Ongoing tax compliance — we ensure you never face avoidable FTA fines again
Have an FTA penalty you want removed? Contact Qaspro Global today for a free penalty review.