The Federal Tax Authority’s installments scheme for Tax Penalty payment

The Taxpayers can now convert Penalty Payments into Installments

The Federal Tax Authority (FTA) has issued Cabinet Decision No. 105 of 2021 on the Procedures of Administrative Penalty Installments and Waivers effective from 1 March 2022.

Following this decision, the Taxpayers can now submit a request to convert the penalty payments into Installments. This initiative will come as a huge sigh of relief for businesses that are burdened with heavy penalties.

A taxable person can apply for Installments of penalty or fine if they fulfil the below conditions:

1. Request can be made for unpaid penalty only;
2. The number of penalties subject to instalment should not be less than AED 50,000;
3. A taxable person can apply for Installments of Penalties if these penalties are not currently disputed in front of the Tax Disputes Resolution Committee (TDRC) or Federal Courts;
4. A taxable person must settle the tax due for the tax period for which the instalment is requested.