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Article 1
Definitions
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Article 1
Definitions
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- A number of previous definitions are omitted from Article 1 of the New Tax Procedures Executive Regulation (already covered under New Tax Procedures Law).
- The definition of the term “assets” has been expanded to include intangible assets, for example, patents, brands, licenses, trademarks, computer programs, copyrights, goodwill and customer lists. This is important for the application of Article 18 of the New Executive Regulation.
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Article 2
Record keeping
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Article 2
Record keeping
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The New Tax Procedures Executive Regulation explicitly indicates the requirement to retain all supporting documents in relation to the accounting records and commercial books of the business. This includes, but is not limited to:
- Relevant correspondence, invoices and tax invoices, licenses and agreements/contracts.
- Documents containing details of any election, determination or calculation made by a taxable person in relation to its tax affairs, including the basis, method of estimation, determination made, and calculation performed.
- Documents with respect to related party transactions and with respect to the circumstances under which such transactions were made, including, for example, transfer pricing documents.
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Article 3
Period of record keeping
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Article 3
Period of record keeping
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The period of retention of documents is updated as follows:
- Real estate - The retention period is updated to seven years from the end of the calendar year in which such a record or document was created.
- General document retention – In case of voluntary disclosure submission, a general period of five years will be extended by one year starting from the date of submission of voluntary disclosure in the fifth year from the end of the relevant tax period.
- Legal representatives are required to retain the required books and records of the person they represent for one year from the date on which such legal representation ends.
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Article 5 Language
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Article 5 Language
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Taxpayers can submit the tax return, data, information, records and any other documents related to tax to the FTA in Arabic or English.
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Article 6 Procedures of Tax Registration, Deregistration and Amendment of Registration Data
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Article 6 Procedures of Tax Registration, Deregistration and Amending Details of Registration
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- The list of instances where registrants are required to notify the FTA of changes to their business data is updated to include notification of the following changes:
- E-mail address.
- Trade licence activities.
- Legal status and partnership agreement for unincorporated partnerships.
- Further, an explicit clause is included under the deregistration provision, which states that where a person fails to submit a deregistration application, the FTA may deregister such registrant at its discretion in accordance with the controls and procedures stated in the Tax Law.
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Article 7 Obligations of Licensing Authorities in the State
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Article 6 (7) Procedures of Tax Registration, Deregistration and Amending Details of Registration
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The New Tax Procedures Executive Regulation inserts a separate article for the Licensing authorities in the UAE to notify the FTA within 20 business days of any issuance or renewal. This obligation for Licensing authorities does not absolve the concerned registrant from his obligations.
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Article 10 Voluntary disclosure
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Article 8 Time limits for Voluntary disclosure
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In line with the New Tax Procedures Law, the New Tax Procedures Executive Regulation now requires submission of voluntary disclosure where a taxpayer discovers an error or omission in a tax return submitted to the FTA, even if it did not impact the due tax. This includes cases where the taxpayer has failed to report VAT on services imported in case of full input tax recovery or reported supplies in Box 1 of the VAT return against an Emirate other than the Emirate in which supplies should have been recorded.
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Articles 11 Means of Notification
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Article 9 Means of Notification and Correspondence by the Authority
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The means of notification now include text messages on mobile phones, notifications through smart applications, and notifications through the FTA’s electronic systems. FTA’s mobile application can be downloaded by both iOS and Android users.
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Article 12,13 and 14 Tax Agents
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Article 10 Tax Agents
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The New Tax Procedures Executive Regulation provides updates around Tax Agents covering specialization, experience, education, registering as natural vs juridical persons, language, procedures for Tax Agent listing and renewal and professional behaviour and integrity.
- Natural Persons - It is no longer a requirement for the Tax Agent to be able to communicate in both Arabic and English as fluency in either of these languages is acceptable or to submit proof that the person is medically fit to perform the duties of the profession.
- Judicial Persons – A juridical person can become a Tax Agent, subject to meeting the requirements as specified within the regulations.
- Listing and de-listing - Tax Agents are required to pay the relevant fees within 20 business days from the FTA’s approval of the registration. Every natural person is required to renew his/her Tax Agent registration every three years, whereas juridical Tax Agents are required to renew their registration every year. If a Tax Agent fails to apply for a renewal before the expiry of the listing, the person will be removed from the Tax Agent list, and the person will no longer be allowed to practice as a Tax Agent.
- Obligations & rights – In addition to the existing obligations, the following have been added:
- Tax Agents have to meet Continuing Professional Development (CPD) requirements, as specified by the FTA.
- Tax Agents are required to retain information, documents, records and data in respect of any person the Tax Agent represents.
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Article 15 to 19 Tax Audits
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Article 11 to 17 Tax Audits
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- Period of Audit Notice - The FTA is now required to give a person at least 10 business days’ notice before conducting a tax audit.
- Right to mark and dispose - The FTA reserves the right to mark any original documents and dispose of an asset after notifying the specified person.
- FTA’s timeline - The timeline for the FTA to respond to a person’s request to view or obtain documents, data and information on which the FTA based an assessment of due tax is updated to 10 business days (earlier 20 business days).
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Articles 23 and 24 Reconciliation process – Tax Evasion crimes
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Not mentioned
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For tax evasion cases, a person may submit a reconciliation application to the FTA before initiating a criminal case, subject to the full settlement of applicable tax and administrative penalties.
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Article 25 Extension of deadlines
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Not mentioned
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- Tax assessment review/request for reconsideration - where the extension is necessary to decide on the review of a tax assessment or a request for reconsideration, the FTA may extend the deadline for a period of 20 business days.
- Tax objection decisions: The Tax Disputes Resolution Committee (TDRC) may extend the deadline for issuing its decision in relation to a tax objection for a period of 60 business days if the extension is necessary to decide on the objection.
- Submitting a tax assessment review/Tax objection - At the request of the person, the FTA and the TDRC may extend the timeframe for submitting a tax assessment review or a tax objection beyond the statutory timelines, subject to the fulfilment of certain criteria.
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Article 27 Bankruptcy
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Article 23 Bankruptcy
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For bankruptcy cases, the appointed trustee must notify the FTA of their appointment within 20 business days. The FTA shall notify the appointed trustee of any taxes due or the initiation of tax audit within 20 business days of the trustee’s appointment.
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Article 31 Effective date
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Not mentioned
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The New Executive Regulation shall be published in the Official Gazette and come into effect on 1 August 2023, except for the provisions relating to the registration of juridical Tax Agents, which comes into effect on 1 December 2023.
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