TaxSavvyAE

Voluntary disclosure linked to a refund

After claiming a refund we found an error. Can we still correct it?

The situation

Since 2026, a voluntary disclosure can be filed within two years of a refund request linked to expiring credits, if the FTA has not decided it yet. Other corrections follow the normal rules.

The law

  • Tax Procedures Law as amended by Federal Decree-Law 17 of 2025: Disclosure window after refund requests for expiring credits
  • Cabinet Decision 129 of 2025 (from 14 April 2026): Revised VAT and excise penalties, including 14 percent a year late payment

What it means for you

Correct the error before the FTA does. The 2026 penalty for a voluntary disclosure is 1 percent a month on the difference, plus 15 percent if made after audit notification. Example: a refund overstated by AED 10,000 corrected after 3 months costs about AED 300 in penalties.

What to do

  1. Quantify the error.
  2. Check if a disclosure is required.
  3. File it promptly.
  4. Adjust the refund or repay.

We can do this for youVAT refunds: excess input VAT refund, 5-year limit, new residence refund for nationals and tourist refund context: AED 2,500

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