UAE CT penalties: AED 10,000 for late registration, AED 500/month (first 12 months) + AED 1,000/month (after) for late filing, and 14% per annum on unpaid CT. Transfer pricing documentation failures: 2% of transaction value. Voluntary disclosure before FTA notification reduces penalties — after notification, a 15% fixed charge applies.
Complete UAE CT penalty schedule
You can be penalised for both late filing AND late payment independently. Filing the CT 300 on time but failing to pay CT by the deadline: 14% p.a. late payment charge applies with no offset for on-time filing. Conversely, paying an estimated CT amount on time but filing late: late filing penalty applies regardless of payment.
| Violation | Penalty | Notes |
|---|---|---|
| Late CT registration | AED 10,000 | Potentially waived if first return filed within 7 months of FY end |
| Late CT 300 return — months 1–12 | AED 500 per month | From the day after the filing deadline |
| Late CT 300 return — month 13+ | AED 1,000 per month | Escalates from month 13 onwards |
| Late CT payment | 14% p.a., calculated monthly | On unpaid balance; from 14 April 2026 (new regime) |
| Failure to maintain TP documentation | 2% of related-party transaction value | Per transaction category; when FTA requests and taxpayer cannot provide |
| Failure to file TP Disclosure Form | AED 50,000 | Fixed penalty; per CT return period |
| Failure to file CbCR (MNE groups) | AED 100,000 — AED 500,000 | Scaling based on period of delay |
| Failure to notify FTA of Tax Group changes | AED 10,000 | Within 20 working days of change |
| Providing inaccurate information | AED 1,000 — AED 10,000 | Depending on severity |
| Failure to keep records (5-year rule) | AED 10,000 | Per failure |
The 14% per annum late payment charge
From 14 April 2026 (Cabinet Decision 129/2025), late CT payment is charged at 14% per annum, calculated and applied monthly on the outstanding unpaid balance. The charge starts the day after the CT payment deadline (which is the same as the CT filing deadline — 9 months after FY end).
CT payments that were due before 14 April 2026 — e.g., the first CT return for a calendar-year business (due 30 September 2024) — are assessed under the old 2% + 4%/month (capped at 300%) regime. Only violations with a due date on or after 14 April 2026 use the new 14% p.a. rule.
| Overdue period | Approximate charge | Example: AED 100,000 CT due |
|---|---|---|
| 1 month | ~1.17% | AED 1,170 |
| 3 months | ~3.5% | AED 3,500 |
| 6 months | ~7% | AED 7,000 |
| 12 months | 14% | AED 14,000 |
Voluntary disclosure — reducing penalties before FTA acts
If you discover a CT error — underpaid CT, incorrect deduction, missed income — a voluntary disclosure filed before FTA notifies you of an audit reduces the penalty significantly:
- Before FTA notification: 1% per month on the CT difference from original due date to VD submission date. A 6-month delay: approximately 6% additional CT to pay.
- After FTA notification: 15% fixed plus 1% per month from the original due date. A 6-month delay after notification: 15% + 6% = 21% additional CT.
- After FTA assessment: Standard CT assessment penalties apply — typically 30%–50% of the understated CT, plus late payment charges.
Run an annual CT compliance review before the return is due — checking for missed add-backs, RCM omissions, TP adjustments needed, and entity classification errors. Voluntarily disclosing an error found in self-review costs 1%/month. Waiting for FTA to find it costs 15% upfront.
Behind on CT registration or filing?
We assess your penalty exposure, prepare the voluntary disclosure, and bring your CT compliance up to date. Early action always reduces cost.
Frequently asked questions
What is the penalty for late UAE Corporate Tax registration?
AED 10,000 fixed penalty. FTA may waive this if the first CT 300 return is filed within 7 months of the financial year end and CT is paid on time, but the waiver is not automatic.
What is the penalty for late UAE CT return filing?
AED 500 per month for the first 12 months after the deadline, then AED 1,000 per month from month 13. This accrues monthly until the return is filed.
What is the UAE CT late payment charge?
From 14 April 2026: 14% per annum, calculated monthly on the unpaid CT balance from the day after the payment deadline. On AED 100,000 unpaid for 3 months, approximately AED 3,500.
What is the penalty for not having TP documentation in UAE?
2% of the value of the related-party transaction for which documentation cannot be provided when FTA requests it. Plus AED 50,000 for failing to file the TP Disclosure Form with the CT return.
Can UAE CT penalties be reduced by voluntary disclosure?
Yes. A voluntary disclosure filed before FTA notifies you of an audit: 1%/month on the CT shortfall. After FTA notification: 15% fixed + 1%/month. Always cheaper to self-disclose than to wait for FTA.
Are UAE CT penalties the same as VAT penalties?
The late payment charge structure is now aligned — both VAT and CT use 14% per annum (effective 14 April 2026 for VAT late payments). Registration and filing penalties differ: CT late registration is AED 10,000; VAT late registration is also AED 10,000. But CT filing penalties (AED 500–1,000/month) differ from VAT filing penalties (AED 1,000 flat per late return).