UAE: Voluntary Disclosure function now available in Portal
It is clear filing returns for many companies has lead to errors in submissions due to a lack of understanding or genuine oversight. To aid companies in restating their returns the voluntary, taxpayers now have the ability to submit voluntary disclosures via the e-services portal. No user guide has, as yet, been published by the FTA.
As per Article 8 of Cabinet Decision No. 36 of 2017 on the Executive Regulation of Federal Law No. (7) of 2017 on Tax Procedures, voluntary disclosures are required to be made in the following cases:
- where a filed Tax Return or a Tax Assessment is incorrect resulting in a calculation of the Payable Tax being less than required i.e. an underpayment of tax due, by more than AED 10,000;
- where a filed Tax Return or a Tax Assessment is incorrect resulting in a calculation of the Payable Tax being less than required i.e. an underpayment of tax due, by not more than AED 10,000 and there is no Tax Return through which the error can be corrected; or
- Where a filed Tax Refund Application is incorrect, resulting in a calculation of refund to which the Taxpayer is entitled being more than the correct amount, unless the error was a result of an incorrect Tax Return or Tax Assessment.
The voluntary disclosure can be submitted by selecting a button marked ‘Submit Voluntary Disclosure’ which should now appear next to each submitted return (on the VAT returns screen of the user’s e-services portal). A separate tab in the return, marked ‘VAT 211 – VAT Voluntary Disclosure / Tax Assessment’, provides further details of the treatment of each of the options above.
The voluntary disclosure must be made within 20 business days of discovering the error or penalties may apply.