Voluntary Disclosure – Key Rules Simplified (Cabinet Decision No. 17 of 2026) -Article 10
The Federal Tax Authority has clarified important rules on correcting VAT errors through Voluntary Disclosure (VD). Taxpayers should first assess the source of the error.
Use
Tax Return correction for small
errors (≤ AED 10,000), where permitted
File Voluntary
Disclosure promptly for:
• Errors > AED 10,000
• Refund-only errors
• Cases where return adjustment is not possible.
1. Errors in Tax Return / Tax Assessment (Underpaid Tax)
|
Criteria |
More than AED 10,000 |
AED 10,000 or less |
|
Nature of Error |
Payable tax less than it should be |
Same |
|
Action Required |
Mandatory Voluntary Disclosure |
Adjust in next Tax Return (if possible) |
|
Timeline |
Within 20 business days from awareness |
In next return (earliest possible) |
|
If adjustment not possible |
VD required within 20 days |
VD required within 20 days |
2. Errors in Tax Refund Application (Overclaimed Refund)
|
Criteria |
More than AED 10,000 |
AED 10,000 or less |
|
Error NOT linked to Tax Return |
Voluntary Disclosure mandatory |
Voluntary Disclosure mandatory |
|
Error linked to Tax Return |
Voluntary Disclosure mandatory |
Adjust in return OR VD |
|
Timeline |
Within 20 business days |
Same rule applies |
Disclaimer: Content posted is for informational and knowledge sharing purposes only, and is not intended to be a substitute for professional advice related to tax, finance or accounting. The view/interpretation of the publisher is based on the available Law, guidelines and information. Each reader should take due professional care before you act after reading the contents of that article/post. No warranty whatsoever is made that any of the articles are accurate and is not intended to provide, and should not be relied on for tax or accounting advice.
Contributor
Neetu Jose is a Partner at Stuart & Hamlyn Chartered Accountants and a Fellow member of the Institute of Chartered Accountants of India. With over 20 years of professional experience in both India and the UAE, she is a seasoned finance professional. Neetu has accumulated over a decade of industry experience in the UAE, demonstrating proficiency in accounting, auditing, financial advisory services, and UAE VAT. Her diverse background includes working in various sectors such as retail, manufacturing, health & hospitality, and shipping.
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