Avoid Penalties: Update Your UAE Tax Records Before the Grace Period

Amending tax records on time is crucial to avoid penalties in the UAE under the Tax Regulations. The FTA has now provided grace period for companies to complete their EmaraTax portal update process UAE. Jaxa Chartered Accountants can help businesses in getting these arrangements done accurately.

Why You Must Update Your Tax Records

The FTA requires tax registrants to make amendments to their tax records within 20 business days of any change or updates that have happened. The amendment will be the EmaraTax portal update process UAE and any non-compliance in making amendments on time can lead to administrative fines.

What is the Grace Period Offered by the UAE Federal Tax Authority

The UAE FTA has now granted a grace period until March 31, 2025 to comply with the UAE tax record amendment rules such as make corrections to incorrect tax record information etc. Such changes or amendments can be done before March 31, 2025 without incurring any UAE Tax penalties.

This grace period provides companies with the perfect opportunity to have correct and up-to-date tax records, thereby keeping in line with UAE tax compliance requirements.

Principal Instances of Changes Which Require Amendments

• Incorrect Shareholding Information: Inaccuracies in shareholder information can result in inconsistencies in tax records and compliance problems.
• Expired Business Licenses and Documents: Expired trade licenses, passports, or Emirates IDs of managers and shareholders need to be updated with renewed documents.
• Incorrect Business Address: Business address changes need to be updated to prevent mismatched tax records.
• Incorrect Authorized Signatory information: Any wrong information pertaining to authorized signatories should be rectified.

Example: The trade license of a company expired on October 31, 2024 and per the UAE Tax Law renewed license should be updated within 20 business days i.e. by November 28, 2024. If the Company has failed to do this, they will be penalized with AED 5,000/- for failure. However, due to this grace period it can complete this amendment before March 31, 2025 without penalties.

Strict penalties for non-compliance are to be applied from April 1, 2025 onwards.

How to Amend Tax Records on the EmaraTax Portal

Updating tax records on the EmaraTax portal is straightforward if done correctly. Follow these steps for compliance:

1. Log into the EmaraTax Portal: Use your login to access your tax account.
2. Check Existing Records: Confirm all details such as shareholding data, business address, and entity type and make corrections, where required.
3. Submit Renewed Documents: Submit all renewed documents, such as trade licenses, Emirates IDs, and passports, and upload them.
4. Submit Amendment: Update required information, upload supporting documents, and submit the application.
5. Adhere to FTA Guidelines: Stick to FTA guidelines for document updates and avoid disruptions in the update process.

By doing this, companies can avoid compliance issues and fully benefit from the FTA’s grace period for tax amendments UAE.

What Happens After March 31, 2025?

If the firms fail to update their tax records by March 31, 2025, then they will face penalties from April 1, 2025 onwards. These are administrative penalties that may hurt the reputation and financial condition of a firm. The use of the grace period for updating tax records is very important in order to avoid such results.

Outcome of Non-Compliance

• Administrative Penalties: Companies are legally sanctioned to pay fines for delay in updating tax records.
• Business Disruptions: Incorrect tax records may cause operational disruptions or legal problems.
• Reputation Damage: Non-conformity might damage the reputation of a firm in the UAE market.

Take Advantage of the UAE Tax Record Update Grace Period

The FTA’s grace period for tax record updates is a valuable opportunity for companies to correct errors without penalties. By addressing issues like outdated documents, incorrect shareholding details, or entity misclassification, businesses can maintain compliance and ensure uninterrupted operations.

Navigating UAE tax record amendment regulations can be complex. Jaxa Chartered Accountants offers professional assistance to help your business stay penalty-free:

• Simplify the Update Process: We ensure your EmaraTax account is accurate and up-to-date.
• Meet Deadlines: We help you comply with the March 31, 2025 deadline effortlessly.
• Avoid Penalties: Through compliance, we ensure your business avoids costly penalties.

Outdated tax records on the EmaraTax portal are no longer acceptable. The FTA grace period for tax amendments gave an error correction grace period until March 31, 2025. Don’t wait for penalties to become unavoidable; act now to secure your business’s future. Don’t wait until penalties are unavoidable—act now to secure your business’s future.

For expert assistance with UAE tax compliance and tax record updates, contact Jaxa Chartered Accountants today. With Jaxa, compliance is just a click away!

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