Updating Tax Records With the FTA: Grace Period and Penalties

If you searched for the UAE grace period to update your tax records and "avoid fines," here is the essential correction: that grace period has ended. It ran from 1 January 2024 to 31 March 2025, and since 1 April 2025 the ordinary penalties for failing to keep your FTA tax record current apply once again. This guide explains what the grace period covered, what you must now report and by when, the penalties that apply today, and how to update your record on EmaraTax — whether you are a VAT or a corporate tax registrant.

What was the UAE grace period for tax record updates?

The grace period was a Federal Tax Authority (FTA) relief measure that suspended administrative penalties for registrants who had failed to update the information in their tax record within the legal timeframe. It ran from 1 January 2024 to 31 March 2025. During this window, no penalty was charged for late tax-record updates, and penalties that had already been imposed for such failures were reversed.

The relief was introduced to help businesses bring their records into line after a period of rapid regulatory change — the roll-out of corporate tax, new trade-licence activities and widespread changes to business addresses and legal structures. It was explained in an FTA public clarification and an accompanying decision. Importantly, it was a temporary measure, not a permanent change to the law.

Has the grace period ended?

Yes. The grace period ended on 31 March 2025. There is no automatic extension. From 1 April 2025, the standard obligation and the standard penalties are fully back in force, and the FTA once again charges the fixed penalties for late tax-record updates.

If you have made any change to your business since the grace period closed — a new address, a change of activity on your trade licence, a new legal structure — and have not notified the FTA, you are now exposed to a penalty. The safest course is to review your record against your current trade licence today. Whether any further grace period is announced in future is at the FTA's discretion; do not assume one exists.

What changes must you report to the FTA?

You must inform the FTA whenever the information held in your tax record changes. In practice, the items that most often change — and most often get missed — are:

A change to your trade licence is the classic trigger — and it is easy to overlook because the licence is renewed with the economic department, not the FTA. Updating one does not update the other. If you are amending a licence, our company incorporation and amendment team can synchronise the FTA record at the same time.

How long do you have to update your tax records?

You have 20 business days from the date of the change to notify the FTA. This is a firm deadline set out in the UAE tax procedures, and it applies to each change separately — the clock starts when the change occurs, not when you get around to it.

Twenty business days is roughly a calendar month once weekends and public holidays are excluded, so it is tighter than it sounds during a busy trading period. The practical fix is to make an FTA-record check a standard step in any licence renewal, relocation or restructuring, so the notification is filed inside the window rather than after it.

What penalty applies now for not updating your records?

Now that the grace period has ended, failing to notify the FTA within 20 business days carries a fixed administrative penalty of AED 5,000 for a first offence and AED 10,000 for a repeated offence, under Cabinet Decision 75 of 2023 (as amended). These are tax-procedures penalties and apply to both VAT and corporate tax registrants.

Note that this is separate from the VAT return penalties under Cabinet Decision 129/2025 and from corporate tax filing penalties — a single business can be exposed under more than one regime, which is why keeping the tax record accurate is a low-cost way to remove one entire category of risk.

How do you update your tax records on EmaraTax?

Tax-record amendments are filed through the EmaraTax portal. The process is straightforward, but the supporting documents must match the change exactly:

1. Log in to EmaraTax — access your taxable person account with your credentials.
2. Open the registration to amend — select the relevant VAT or corporate tax registration.
3. Choose the amendment — edit the section that changed (business activities, address, contact details, legal type).
4. Attach supporting documents — upload the updated trade licence, memorandum of association or equivalent evidence.
5. Submit within 20 business days — file before the deadline; the FTA reviews and confirms the change.
6. Keep the confirmation — retain the approval and reference for your records.

What happened to penalties charged during the grace period?

During the grace-period window, penalties for late tax-record updates were waived. Where a penalty had already been imposed for such a failure inside that period, the FTA reversed it and credited the amount to the taxable person's EmaraTax account; where it had already been paid, it was refunded.

This relief was specific to the grace-period window and to the tax-record-update penalty. It does not reach back to unrelated penalties, and it does not apply to failures that occur now. If you believe a penalty was reversed to your account during the window, check your EmaraTax balance and reconcile it with your records — our team can help verify what was credited.

Worked example: a Dubai LLC that changed its licence

Consider a Dubai LLC that, in May 2026, relocates its office and adds a new activity to its trade licence. It updates the licence with the economic department but forgets the FTA. It finally files the EmaraTax amendment 40 business days later.

The AED 5,000 was entirely avoidable — the business did the hard part (updating the licence) but missed the free, five-minute FTA step. Had the grace period still been open, no penalty would have applied; today, it does.

Who does this apply to — VAT or corporate tax registrants?

Both. The duty to keep your tax record accurate applies to every FTA registrant. If you hold a VAT registration, a corporate tax registration, or both, each record must reflect your current details and each is updated through EmaraTax.

Businesses that registered for corporate tax more recently are especially exposed, because their FTA details were often captured at set-up and never revisited while the business grew, moved or changed activities. If you registered for corporate tax and have changed anything since, treat a record review as overdue. Our VAT filing and corporate tax teams check the record as part of routine compliance work.

How to stay compliant now the grace period is over

Staying compliant is mostly about process. The recurring failures are simple and avoidable:

If you are unsure whether your FTA record is current, a quick review against your latest trade licence settles it. Fastlane's FTA-registered agents reconcile your record, file any pending amendments and keep your corporate tax and VAT registrations in step — so one avoidable category of penalty is taken off the table.