Cabinet Decision No. 129/2025 Amending certain provisions of Cabinet Decision No. 40/2017 on Administrative Penalties Imposed for Violations of the State’s Tax Laws, which became effective on 14 April 2026, refines, rather than replaces, the United Arab Emirates (UAE) administrative penalties regime, requiring tax practitioners to reassess compliance strategies, penalty exposure, and advisory approaches. Practitioners must place greater emphasis on timely and accurate filings, robust record-keeping, and proactive error identification, as penalties continue to apply for failures such as late submissions, incorrect returns, or inadequate documentation. The revised treatment of voluntary disclosures is particularly significant, with structured penalties linked to timing and tax differences, incentivising early correction while increasing costs for delayed or post-audit disclosures. Overall, the changes necessitate enhanced compliance monitoring, client education, and review of historical positions to mitigate risks under the updated enforcement approach.

• Administrative fines: Monetary penalties imposed by the FTA for breaches of tax laws.

• FTA: The Federal Tax Authority responsible for administering and enforcing UAE tax legislation.

• Compliance: Adherence to filing, reporting, and record-keeping obligations under UAE tax laws.

• Tax assessment: Decision issued by the FTA determining payable or refundable tax.