The Federal Tax Authority (FTA) has announced that fees paid for “private clarification” of tax will be refunded in certain cases if the clarification is not issued, effective August 1. Under this service, companies can request further clarification related to one or more taxes issued by the FTA, with fees introduced starting June 1, 2023. If the clarification is not issued, the full fee will be refunded for requests related to one or more taxes. In cases where the clarification is issued for only one tax out of multiple taxes, a part of the fee will be refunded.
The amount to be refunded will be based on the difference between the fee for more than one tax and the fee for one tax. According to FTA Decision No. 5 of 2024, the cases where the fee will be refunded include instances where the private clarification request is withdrawn within two business days, the applicant is not registered for Corporate Tax and the subject is not related to tax registration, the applicant is under tax audit by the Authority, the request is about procedures following an Authority decision, the request is a duplication of another request being processed, or the request is related to a subject under coordination with the Ministry of Finance to amend tax legislation.
It is important for companies to stay updated with the latest news and regulations from the FTA. This move by the FTA aims to streamline the process of seeking clarifications related to taxes and provide transparency in fee refund scenarios. By allowing for refunds in cases where clarifications are not issued, companies can have confidence in seeking further clarification without the risk of losing their fees. This initiative also encourages compliance with tax regulations and promotes a more efficient tax system.
Companies seeking private clarification on tax-related matters can now do so with the assurance that their fees will be refunded if the clarification is not issued. This provides an added layer of protection for companies engaging in the process of seeking further clarification on tax-related issues. It also incentivizes companies to proactively seek clarification on tax matters to ensure compliance with regulations and avoid potential penalties or audits in the future.
By offering refunds for private clarification fees in certain cases, the FTA is signaling a commitment to transparency and fairness in the tax system. This move is likely to be welcomed by companies operating in the UAE, as it provides them with financial protection when seeking clarification on tax matters. It also demonstrates the FTA’s willingness to work with businesses and ensure that the tax system is clear and accessible for all involved parties.
In conclusion, the FTA’s decision to refund fees for private tax clarifications in specific cases is a positive development for companies operating in the UAE. It promotes transparency, fairness, and efficiency in the tax system, while also incentivizing companies to seek clarification on tax-related matters. By providing this financial protection, the FTA is encouraging compliance with tax regulations and fostering trust between tax authorities and businesses. Companies should take advantage of this opportunity to seek the clarification they need while knowing that their fees will be refunded if the clarification is not issued.
