A monthly penalty of 14 percent per year will be imposed on taxpayers who fail to pay the corporation tax that is due for each month or a portion of it, according to clarification from the Federal Tax Authority (FTA). This penalty is applied to the amount of unpaid taxes and is computed starting the day after the due date. It builds up on the same day every month after that.
According to Federal Decree-Law No. 47 of 2022 on Corporate Tax and its subsequent amendments, the FTA stated in a news release today that the deadline for this penalty is nine months from the conclusion of the applicable tax period.
The FTA issued Decision (7) of 2024 last September on the Postponement of the Deadline to File a Tax Return and Settle the Corporate Tax Payable to December 31st, 2024 for Tax Periods ending on or before February 29th, 2024 (for example, tax periods ending in December 2023, January 2024, or February 2024) as part of its commitment to facilitate and encourage voluntary tax compliance across business sectors with ease and efficiency. Businesses liable to corporate tax whose tax periods ended on or before February 29, 2024, were asked by the FTA in a media statement today to submit their tax returns and pay the FTA the corporate tax payable for their tax period by the end of December 2024.
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