Tax Procedures Law UAE: A Complete Guide to Compliance, Enforcement, and Modernization for 2025

Tax Procedures Law UAE: The Comprehensive Guide to Compliance, Enforcement, and Modernization (November 2025)

Estimated reading time: 12 minutes

Key Takeaways

• Federal Decree-Law No. 28 of 2022 on Tax Procedures and Cabinet Decision No. 74 of 2023 on its Executive Regulation constitute the current legal framework for tax procedures in the United Arab Emirates. UAE Legislation
• Record-keeping, registration, filing, payment, audit and dispute mechanisms are governed by the foregoing instruments and by the applicable tax laws (including Value Added Tax and corporate tax). UAE Legislation
• The Electronic Invoicing System will operate under a pilot beginning 1 July 2026, with mandatory phases commencing in 2027 under Cabinet Decision No. 100 of 2025 and Ministerial Decisions No. 243 and No. 244 of 2025.
• Audit powers, limitation periods and administrative penalties necessitate timely and accurate compliance. UAE Legislation

Introduction: Unveiling the Tax Procedures Law UAE

The tax procedures framework of the United Arab Emirates is governed by Federal Decree-Law No. 28 of 2022 on Tax Procedures and Cabinet Decision No. 74 of 2023 on the Executive Regulation of the Tax Procedures Law. These instruments regulate rights and obligations of the Federal Tax Authority and taxpayers, including registration, record-keeping, filing and payment, audit, dispute resolution, recovery and collection, and administrative penalties.

This guide unpacks core tenets, recent updates, and practical measures dictated by the two foundational instruments: Federal Decree-Law No. 28 of 2022 on Tax Procedures and its Executive Regulation, Cabinet Decision No. 74 of 2023. Both have repealed prior laws, ensuring that only the latest consolidated versions are enforceable as of November 2025.

For deeper insight into corporate tax rates, filing obligations, and strategic planning, see our Corporate Tax Law UAE guide.

The Legal Foundations: What Governs Tax Procedures Law UAE (As of November 2025)?

• Federal Decree-Law No. 28 of 2022 on Tax Procedures – the bedrock for all regulatory, administrative, and enforcement mechanisms applied by the Federal Tax Authority.
• Cabinet Decision No. 74 of 2023 – the Executive Regulation operationalizing the decree law, detailing compliance, filings, audits, penalties, and appeals.
• Explicit Repeal of Prior Laws – Federal Law No. 7 of 2017 and earlier frameworks are completely replaced and no longer relevant.

Core Procedures and Requirements Under the Tax Procedures Law UAE

1. Tax Registration & Record-Keeping

• VAT Registration: Entities with turnover exceeding AED 375,000 in 12 months must register; voluntary at AED 187,500 (VAT Law UAE guide).
• Document Retention: Record-keeping: retain accounting records, commercial books and supporting documentation for five years after the relevant tax period (for taxable persons); five years from the end of the calendar year for non-taxable persons; and seven years for real estate records; with specified extensions (up to four additional years for audits or disputes, and one additional year for a voluntary disclosure made in the fifth year).
• Registration, deregistration and amendment of registration data must follow the procedures issued under the Executive Regulation.
• Penalties: Failure to register or submit returns on time triggers fines.

2. Tax Filing and Payment

• Submission Deadline: Tax returns must be prepared and submitted in accordance with the Tax Procedures Law and the applicable tax law. Value Added Tax returns and related payments must be completed within 28 days after the end of the relevant tax period. (UAE Legislation Portal).
• Data Accuracy: Taxpayers are responsible for completeness and correctness; errors lead to rejection.
• Payment Allocation: Specify tax type and period; if omitted, the FTA allocates payments per the Executive Regulation.

3. Tax Audits and the Statute of Limitations

• Audit Powers: FTA may conduct desk-based or on-site audits at its discretion.
• Standard Period: Five-year limitation for audits and assessments. In fact the general prescription period is five years from the end of the relevant tax period, subject to statutory extensions.
• Exceptional Extension: In cases of tax evasion or non-registration, audit and assessment may occur within fifteen years.

4. Dispute and Appeal Procedures

Disputes follow a strict path:

• Reconsideration Requests: Internal review by an FTA committee.
• Disputes Resolution Committee: Mandatory objection before independent committee of a judge and two tax experts.
• Federal Court Appeals: Progression through the Court of First Instance, Court of Appeal, and Federal Supreme Court.

In fact, a person may request reconsideration by the Federal Tax Authority within the statutory time limits. Objections to reconsideration decisions are lodged with the Tax Dispute Settlement Committee formed by a judicial member and two registered tax experts. The committee’s decisions are final for disputes not exceeding one hundred thousand dirhams; larger disputes may be appealed to the Competent Court within the prescribed period. Court hierarchy and nomenclature depend on the venue; the statute uses the neutral term ‘Competent Court.’

5. Special Provisions: E-Invoicing and Reconciliation

• E-Invoicing System: a pilot begins 1 July 2026; mandatory adoption occurs in phases from 2027 under Cabinet Decision No. 100 of 2025 and Ministerial Decisions No. 243 and No. 244 of 2025. Requirements and transmission timelines are governed by these instruments and the Value Added Tax Executive Regulations as amended. (VAT Law UAE guide).
• Reconciliation Mechanisms: the Executive Regulation provides for reconciliation in specified circumstances, with conditions and payment rules detailed therein.

6. Enforcement and Penalties

• Administrative Fines: Substantial daily fines and compounding penalties for ongoing breaches.
• Default Interest: Accrued interest on unpaid taxes and penalties.
• Penalty Schedules: Detailed calculations in the Executive Regulation.

In fact, administrative penalties are prescribed by Cabinet decisions and differ by tax. For Value Added Tax and excise tax, refer to Cabinet Decision No. 49 of 2021 (as amended). For corporate tax, refer to Cabinet Decision No. 75 of 2023. Certain penalties accrue monthly and may compound. Always consult the current penalty tables rather than applying generic ranges.

Cross-Validation and Practical Implementation Notes

All procedural statements above are drawn from Federal Decree-Law No. 28 of 2022, Cabinet Decision No. 74 of 2023, and current Federal Tax Authority and Ministry of Finance publications, including the Electronic Invoicing System decisions. Practitioners should monitor new public clarifications and ministerial decisions.

Ongoing digitalization, e-invoicing rollout, and compliance monitoring remain.

Practical Guidance for UAE Business and Professional Community

• Use Updated Texts Only: Refer solely to Federal Decree-Law No. 28 of 2022 and Cabinet Decision No. 74 of 2023, together with the applicable tax laws (including Value Added Tax and corporate tax) and their executive regulations.
• Monitor MOF and FTA Updates: Monitor the Ministry of Finance and Federal Tax Authority websites for updates, including Electronic Invoicing System milestones.
• Conduct Tax Health Checks: Conduct regular internal audits for VAT, corporate tax, and e-invoicing system readiness, with particular focus on record-keeping periods and limitation periods.
• Engage Legal Counsel: “Engage specialist counsel for disputes or complex procedural questions.

The Final Word: Only the Latest Laws Apply

The tax procedures law UAE has evolved into a modernized, transparent system. Federal Decree-Law No. 28 of 2022 and Cabinet Decision No. 74 of 2023 are the sole enforceable authorities, fully replacing prior laws.

Non-compliance risks severe penalties, audits, and litigation. Commit to continuous compliance, digital readiness, and ongoing education on the evolving tax procedures law.

Frequently Asked Questions

• Q: What is the main tax procedures law in the UAE?
  A: Federal Decree-Law No. 28 of 2022 on Tax Procedures, operationalized by Cabinet Decision No. 74 of 2023.
• Q: How long must businesses keep tax records?
  A: Five years for taxable persons after the relevant tax period; five years from year-end for other persons; seven years for real estate records; plus statutory extensions (up to four additional years for audits or disputes, and one additional year where a voluntary disclosure is submitted in the fifth year).
• Q: When does e-invoicing become mandatory?
  A: A pilot begins on 1 July 2026. Mandatory implementation occurs in phases from 2027 under Cabinet Decision No. 100 of 2025 and Ministerial Decisions No. 243 and No. 244 of 2025.
• Q: What are the limitation periods for tax audits?
  A: The general limitation period is five years from the end of the tax period, subject to statutory extensions; the period is up to fifteen years in cases of tax evasion or non-registration.