Excise Tax Return Filing Services

An excise tax return is a statement of the excise tax amount due which a taxable business/individual needs to pay over a particular tax period. It captures the cumulative excise tax payment for manufacture, import or discharge of excise goods in the United Arab Emirates (UAE). To file an excise tax return, follow these steps:

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How to File an Excise Tax Return?

Login to the FTA Portal:-To be able to connect to the website offering FTA e-services, you need to enter your username and password.

Navigate to Excise Tax Returns:-Choose ‘Excise Tax’ at the top of the page and click ‘Excise Tax Returns’.

Select Tax Period:-Select the tax year to which you want to prepare and file the return and then select “Complete Return”.

Review Declarations:-Check the particulars of declarations made for manufacture, import or clearance of excise goods for the chosen tax period.In particular, make all the information provided as accurate as possible. In case of contradiction, go back to the declarations in order to make necessary corrections.

Validation and Summary:-After confirming the data, go to the declaration to validate the statement and then go to the summary page.There should be an examination of the total amount of payable excise tax and the balance of credits in the FTA account.

Submit or Make Payment:-If your tax liability is covered by your available balance, click on ‘Submit’.If the balance is insufficient, click on ‘Make Payment’ and follow the instructions to pay the excise tax via the eDirham Payment Gateway.

Confirmation:- When you file the return or make the payment, you are assumed to receive a confirmation message together with a reference number.

Importation of Excise Goods: What to Do?

Excise materials like carbonated beverages, tobacco, energy gel, and electronic cigarettes are goods that attract excise tax in UAE. Some of these goods require importers to be registered before they can be imported into the country.

Unregistered Importers dealing with Excise Goods

Unregistered importers who do not manufacture or bring into the UAE, store or supply excise goods and do not satisfy the conditions for voluntary registration may be exempted from registration for excise tax. The purchase must pay excise tax before forwarding the goods through Customs. Here’s how:

Access the FTA Website:

Access the FTA Website:Visit FTA website and scroll to ‘Excise Tax’ for Importers’ service.

Complete Import Declaration:Fill out the import declaration form with details about the excise goods, including origin, description, quantity, and value.

Calculate Excise Tax:-Determine the excise tax owed using the standard price list published by the FTA, which displays the minimum prices for excise goods.

Pay Excise Tax:-Pay the excise tax using the eDirham Payment Gateway and obtain a transaction ID.

Provide Documentation to Customs:Present the import declaration and transaction ID to the Customs Department. Once payment is confirmed, goods will be approved for entry into the UAE.

How do registered Importers deal with Excise Goods?

Registered importers do not pay excise tax at the point of import; instead, they pay it when filing their excise tax return. Here are the steps:

Access the FTA Website:-Visit the FTA website and go to the ‘Excise Tax for Importers’ service.
Complete Import Declaration:-On the import declaration form, provide particular information concerning the excise items imported.

Calculate Excise Tax:-From the price list, developed by the FTA one must determine the excise tax to be paid. If not, then you have to use the retail sale price of the specific item which you are using in adjusting your taxable base.
Submit Import Declaration:-Duly complete the import declaration and obtain a transaction identification number.
Interaction with Customs:-Apply the translated transaction ID and import declaration to the Authorities of the Customs Department. Goods will only be cleared once the importer produces the required documents to change the status of the goods.
Link to Tax Registration:-In the FTA system the TRN of the importer will be affixed to the import declaration and the excise tax return for the corresponding tax period will be completed.
Payment of Excise Tax:-The excise tax is to be paid together with the return, and the importer has up to 15 days within the end of a tax period to make the payment.

How to Pay the Excise Tax?

The excise tax can be paid online via the FTA e-services portal. Follow these steps:

Login to the FTA Portal:Enter your login credentials.
Navigate to Excise Tax Returns:-Choose the type of return you require and click on the option ‘Excise Tax Returns’.Complete Return:-Choose which tax period to work on and then click on the button that reads “Finalize Return”.
Review Declarations:Check that the particulars of declarations submitted earlier are correct.
Proceed to Summary:-Use the summary page to see the total amount excise tax due , and remaining balance available.
Submit or Make Payment:-Press ‘Submit’ if the balance is enough to pay the required amount of tax. If not, go to ‘Make Payment’ whereby you will pay through the eDirham Payment Gateway.
Confirmation:-After the payment has been made or the submission is made you will receive a confirmation message together with a reference number.

For Non-Compliance Penalties/Fine

Late filings or late payments will incur a certain penalty, depending on the size and the nature of the business of the company.The filing of the excise tax return is time-sensitive as is the payment for excise tax. The FTA imposes penalties for noncompliance as follows:

Filing Deadlines:The prescribed time to file Excise tax returns is fifteen days from the conclusion of the prescribed financial month . If it lands on a Saturday or Sunday or any other holiday it reverts to the next business day.

Penalties for Late Filing:A first offense of AED 1,000 for not filing the excise tax return timely and an additional AED 2,000 in the event it is filed later than the due time.

Penalties for Late Payment:-Interest at two per cent for every day of default up to a maximum of the amount of unpaid tax.

While following guidelines and timelines, management of organizations need to adhere while paying excise taxes to avoid penalties that are not required.

Guide on filing Excise Tax Returns in the UAE

Filing excise tax returns in the UAE is a vital exercise that affects companies that engage in excise goods business. Excise Tax Filing includes the procedures of filing the excise tax returns, the timeline required for filing and the procedure related to import of excise goods as mentioned below.

Online Submission:-In the UAE, registration and submission of excise tax returns is done using the Federal Tax Authority (FTA) web page. Manual submission is not allowed. The online form has also been developed and is in both English and Arabic.
Filing Deadline:-Excise tax returns are in accordance with the monthly tax period. Companies and organizations must submit their returns through the FTA website within one month from the end of the tax period.

Submission Process

Access the FTA Portal: Go to the FTA e-services login screen.
Review Declarations: Any information entered during the tax period will be brought forward on the excise tax return. This information should be carefully Double-checked for the purposes of its accuracy.
Submit the Return: Nevertheless, once the taxable person has been established, he can submit the excise tax return and make the relevant payment.

Payment Of Excise Tax On Excise Goods:-

On importation of excise goods the importer is required to pay the excise tax before the time of importation. Consequently, there are different procedures for non-registered and registered importers.

For Non-Registered Importers

Access the FTA Website: Special amnesty importers, who are those that do not require registration of excise tax have to go to the FTA and make an import declaration.

Complete Import Declaration:- A declaration that should accompany these imported products should indicate the nature of the products being imported.
Calculate Tax Liability: Calculation of the tax liability should be done through the FTA’s standard price list. Where the price is not indicated the importer is required by the act to assess the tax himself on a retail sale price basis.
Pay Excise Tax: It is required that payment must be made prior to clearing through customs. In addition to this, the Customs Department will confirm the declaration using the importer’s transaction identification.
Customs Clearance:- On confirmation of the declaration, the goods are free to be imported into the UAE by Customs.

For Registered Importers

Non-registered importers and registered importers follow a similar process as mentioned above.

Tax Payment Timing: However, the tax is paid too when filing the excise tax return rather than at the time of import.
Customs Verification: As soon as Customs affirms the declaration the goods are instantly delivered clear of entry.
Relevant Information: The information on imported goods is recorded in the FTA system and correspondingly associated with the TRN of the importer.
Automatic Population: In filing returns, the tax information for imported excise goods are pre-filled when calculating the returns.

Excise Tax Payment Workflow

Excise tax payments are made through the FTA’s website by business owners. In return, the FTA processes the payment through the eDirham Payment Gateway.Once the billing process is over the taxpayer gets an acknowledgement message.

Consequences of Late Filing

Filing of excise tax returns is important to undertake regardless that excise tax has been paid because the returns should be filed on time. As noted, failure to file on time or failure to file at all incurs penalties from the FTA.

Other guidelines which include submission and payment deadlines.

Excise tax returns are filed within fifteen days from the related tax period.Excise tax payment is required 15 days after the end of the calendar month where the collection occurred.In case when the due date is for the weekend or a national holiday then it will be considered the next business day.The FTA can reimburse excise tax allocated to excise goods, paid in the past. When so, the taxable person can reduce the value of the refunded tax from the total amount of the excise tax payable for the following month’s excise tax return.Conforming with these rules and timelines will make a business able to adhere to the UAE excise tax regime and stay away from penalties.