Mistakes on VAT returns happen to every business. An invoice gets missed, an expense is claimed that shouldn’t be, or a figure lands in the wrong box. The good news is that the UAE now makes it much cheaper to fix these mistakes yourself than to wait for the Federal Tax Authority (FTA) to find them.

New rules that came into force in 2026 simplified how this works. Here is what you need to know as a business owner, explained through everyday examples.

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What is a voluntary disclosure?

A voluntary disclosure is simply a form you submit to the FTA to correct a VAT return you have already filed. Think of it as putting your hand up and saying: “We got this wrong, here is the right figure.”

It is filed online through EmaraTax, the FTA’s portal. It can correct mistakes that cost the government money, and mistakes that cost you money.

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Do I need to file one?

It mostly comes down to two questions: did you pay too little or too much, and by how much?

• You paid too little VAT, by more than AED 10,000. You must file a voluntary disclosure, within 20 working days of spotting the mistake.
• You paid too little VAT, by AED 10,000 or less. You can simply fix it in your next VAT return. No separate form is needed.
• You paid too much VAT. Filing is your choice. If you want the money back, a voluntary disclosure is how you claim it.

Missed the 20 working days? File anyway, as soon as you can. As long as the FTA hasn’t contacted you about an audit, it still counts as voluntary and is treated far more gently.

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Three common scenarios

1. You find the mistake yourself. A company leaves a sales invoice out of its VAT return, so AED 15,000 of VAT goes unpaid. Four months after the return was due, it spots the error and files a voluntary disclosure. The penalty is 1% a month: AED 600, plus the AED 15,000 of VAT.
2. The FTA finds it first. Same mistake, but the company only corrects it after receiving an FTA audit notice. The penalty jumps to 15% plus 1% a month: at least AED 2,850. That is nearly five times more for the same error.
3. A small mistake. A café claimed AED 4,000 of VAT on a personal expense. Because it is AED 10,000 or less, no disclosure is needed. The café simply corrects it in its next VAT return.

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What does it cost?

Since 14 April 2026, the penalties are much simpler and lower than before:

• If you correct it yourself: 1% of the missing VAT for each month since the original return was due. The sooner you file, the less you pay.
• If the FTA finds it first: a fixed 15% of the missing VAT, plus the same 1% a month.

Under the old rules, a mistake the FTA found could cost 50% of the missing VAT and more. The new system is fairer, but the message is the same: fixing it yourself, early, is always the cheapest option.

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Two deadlines to keep in mind

Pay within 20 working days. Any extra VAT shown on your disclosure must be paid within 20 working days of filing it. Pay late, and a further charge of 14% a year starts to build up on the unpaid amount.

Five years is the limit. A mistake can only be corrected within five years of the end of the VAT period it relates to. After that, the door closes. That matters most if you overpaid: VAT you were owed from a period more than five years ago can no longer be claimed back.

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A simple checklist

1. Have your VAT returns reviewed against your accounts at least once a year.
2. When a mistake turns up, note the date you found it. The 20 working days start from then.
3. Check the size: over AED 10,000 means a disclosure; smaller amounts go in your next return.
4. Look back at older periods too, in case you are owed money.
5. Keep the invoices and calculations behind every correction.

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How Onecentive can help

Our team can review your filed VAT returns, tell you whether anything needs correcting, and prepare and file voluntary disclosures on EmaraTax for you. If you think something may have gone wrong, get in touch before the FTA does.

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For more information, reach out to our team of experts:

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📧 info@one-centive.com

🌐 www.one-centive.com

📍 Office 508, The Binary by Omniyat, Business Bay,Dubai, UAE

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Onecentive LLC-FZ is licensed under Meydan Free Zone, Dubai, UAE. This article is for general informational purposes only and does not constitute tax or legal advice. Other rules, exceptions, and requirements may apply depending on your circumstances.

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