UAE VAT Voluntary Disclosure
Registered Tax Agent Regulated by the FTA (Federal Tax Authority)
AT Voluntary Disclosure Services in the UAE
Correct VAT Errors Proactively — Reduce Penalties and Restore FTA Compliance
The Federal Tax Authority uses advanced data systems to cross-reference tax returns, bank records, and third-party information to identify filing errors and discrepancies. Businesses that identify and disclose errors voluntarily before the FTA detects them benefit from significantly reduced penalties and a stronger compliance standing.
Farahat & Co. provides professional VAT voluntary disclosure services, guiding businesses through the full process from error identification and calculation through to FTA submission and resolution.
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What is a VAT Voluntary Disclosure?
A VAT voluntary disclosure is a formal submission made to the Federal Tax Authority to correct errors or omissions in previously filed VAT returns. It applies where a business has underpaid VAT, overclaimed input tax, or made an error in its tax reporting — and proactively brings the correct position to the FTA’s attention before a formal audit or investigation is initiated.
Making a voluntary disclosure demonstrates good faith and regulatory transparency. The FTA applies lower penalties to voluntarily disclosed errors than to issues it identifies through its own review processes — making early disclosure the most cost-effective way to resolve compliance gaps.
The voluntary disclosure process covers:
- Notifying the FTA of the intent to make a voluntary disclosure
- Identifying and clearly describing the errors or omissions
- Explaining why the errors occurred
- Calculating the correct VAT liability, along with applicable penalties and interest
- Submitting the disclosure through the EmaraTax portal
- FTA review and processing of the submission
- Reaching a formal agreement between the taxpayer and the FTA
Time Limits for VAT Voluntary Disclosure
The FTA sets clear deadlines for voluntary disclosure submissions depending on the value of the error identified.
- Errors above AED 10,000 — where an error has resulted in an underpayment of VAT exceeding AED 10,000, the voluntary disclosure must be submitted within 20 business days of the date the error was identified
- Errors of AED 10,000 or less — where the underpayment is AED 10,000 or less, the error may be corrected in the VAT return for the period in which it was discovered, provided it is submitted before the return’s due date
- Where no VAT return is available — if there is no upcoming VAT return in which the correction can be made, the error must be reported to the FTA within 20 business days of it being identified
Failing to disclose within the required timeframe results in higher penalties than those applied to timely voluntary disclosures.
How Farahat & Co. Can Help with VAT Voluntary Disclosure
Farahat & Co. manages the full voluntary disclosure process on your behalf — ensuring the submission is accurate, complete, and structured to achieve the best possible outcome with the FTA.
Error Review and Documentation We review your VAT returns, financial records, and supporting documents to identify the nature and extent of the errors. The FTA requires a formal letter setting out the background facts, a detailed description of the errors, and the reasons they occurred. Our team prepares and submits this documentation on your behalf.
VAT Liability Calculation We calculate both the incorrect amounts previously reported and the correct figures — presenting both to the FTA with full supporting documentation. This gives the authority a clear, transparent view of the discrepancy and the corrected position.
Penalty Assessment and Settlement Support Voluntary disclosures attract penalties, but at a significantly lower rate than errors identified by the FTA during an audit. We advise on the applicable penalties, help you understand your options, and support the settlement process — including liaison with the FTA where required.
Frequently Asked Questions on VAT Voluntary Disclosure
What is a VAT voluntary disclosure in the UAE?
When should a VAT voluntary disclosure be made?
What errors require a VAT voluntary disclosure?
What are the penalties for a VAT voluntary disclosure?
Is it better to make a voluntary disclosure or wait for an FTA audit?
What documents are required for a VAT voluntary disclosure?
How is a VAT voluntary disclosure submitted in the UAE?
Can Farahat & Co. submit a VAT voluntary disclosure on my behalf?
Does making a voluntary disclosure affect my relationship with the FTA?
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