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Corporate Tax Audit in UAE

Corporate Tax audit in the United Arab Emirates is an essential part of the UAE’s taxation system. Such audits are used to ensure that the financial information, tax estimates, and statements made by taxable subjects are appropriate. The undertaking of the audit process cannot be overemphasized as it helps the tax administration to remain efficient with due regard to fairness and free from fraud and evasion. Currently, the UAE has introduced corporate taxes for various businesses;it is crucial for these businesses to learn the auditing procedures in the UAE, with the aim of returning the audit results in a correct format.

How to File Corporate Tax Return in UAE

What Is the Corporate Tax Audit Timeline?

The main body that undertakes the task of conducting corporate tax audits in the UAE is the Federal Tax Authority (FTA) that has the right to begin the audit within five years from the end of the specific tax year or from the date of filing of the return in question, whichever is later. This enables the FTA to re-open any tax period or declaration within this period even if a tax assessment has been prepared and dispatched.

Where there are suspicions of tax evasion or fraud the FTA is able to extend the audit period by further of five years making it possible to have an audit for a maximum of ten years. Normally the taxable bodies should be notified at least five working days before the commencement of the audit other than in the cases where the FTA has reason to believe that some material facts have been withheld. In such cases, surprise audits can be carried to guarantee a proper investigation of the issue involved.

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Documents Required for UAE Corporate Tax Return Filing

Penalties for Audit Violations

Sanctions that can be applied to the corporations violating the UAE Tax Laws and Regulations can be different depending on the character and gravity of the violation. Some of the penalties that may be imposed include:

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How to File Corporate Tax Return in UAE

Guidelines for Preparation for Audit

To ensure a successful audit process under the UAE corporate tax laws, businesses should adhere to the following best practices:

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