Businesses are required to file an excise tax return in UAE on EmaraTax Portal online to submit and pay the amount of excise tax for specific tax period. Registered businesses that import, produce, or stockpile excise goods in the UAE are required to file their excise tax returns on a quarterly basis. We, BMS Auditing can assist you in the complete Excise Return Filing process in UAE.
The UAE government launched new excise tax rates which were implemented in December 2019, that resulted in the increase in prices of specific product categories sold in the country. Most people and businesses were inquisitive to know how the new law would affect them. BMS has the answer to the queries regarding the excise tax in the UAE.
What is Excise Tax?
An excise tax is a type of indirect tax that is imposed on specific goods that are deemed harmful to society, such as tobacco products and energy drinks. The purpose of the excise tax is to reduce the consumption of these goods and discourage their use, while also generating revenue for the government.
These goods are taxable if imported to the UAE, produced, or stored in the UAE. This tax is only charged on products that are hazardous to people or the environment. The ultimate purpose of this tax is to mitigate the consumption of such goods to prevent unhealthy activities.
In certain contexts, the goods would be physically labeled to show that excise taxes were paid to the government.
Why submit Excise Tax in UAE?
Submitting excise tax is a legal obligation for businesses that import, manufacture, or produce excise goods. It is also required for businesses that sell or distribute excise goods within the country. Failing to pay the excise tax or submit it to the authorities can result in penalties and fines, and may negatively impact the business's reputation.
Who should file for Excise Tax in UAE?
You are liable to register and pay the excise tax if you are involved in any of the following activities:
- Import of excise goods and services
- Producing or manufacturing excise goods
- Transferring the excise products outside the allocated region
- Accumulating excise goods in the business
- Selling excise goods in the country, while this tax is incurred by the seller and the amount is included in the total sales price of the excise product
How to File The Excise Tax Returns in UAE?
Taxpayers can file their taxes online using the Federal Tax Authority's new Emaratax platform.
- You can go to "EmaraTax" Register or log in using UAE ID Pass or FTA account. Read EmaraTax login Guide
- Add your business details and Business activities
- Click Excise Tax
- Review and declare your Excise Tax Returns
- Proceed with the Payment using Giban or MagnatiPay. The Excise Tax Return payment method is similar to the VAT payment in EmaraTax
Look at the video to get a clear idea
Excise Tax returns should be filed on a regular basis, which is commonly described as a tax period. Manual returns will not be accepted. The online return form will be available in both English and Arabic.
Once you register for the Excise Tax in the UAE, it is important and necessary that you file the Excise Tax returns by the 15th day after the end of the tax period. The details submitted in each declaration would be recovered in the excise tax return and auto-filled at the end of the return period.
As a taxable individual, you must thoroughly verify the accuracy and precision of the information provided in the return before submission. You would then produce the return and complete the payment for the excise tax.
BMS provides complete excise tax services in the United Rab Emirates for timely and the most efficient excise tax filing services and excise tax registration services in UAE.
When is the deadline to pay Excise tax Returns in UAE?
The tax period to file the excise tax returns is one month. As a business, you should file your excise tax returns via the FTA online portal within 15 days of the tax period. Excise tax should be paid 15 days after the end of the calendar month. If the deadline falls during the weekend or national holiday, it would be shifted to the first working day following the holiday or the weekend.
The deadline dates for excise tax return filing in 2023 are,
- 17 April 2023
- 17 July 2023
- 15 August 2023
- 17 October 2023
Excise Tax Return Filing in UAE for August 2023
UAE announces the deadline for filing Excise Tax in the UAE for the tax period ending on July 2023 i.e., on August 15, 2023. Businesses should ensure to file their returns with the necessary documents before the deadline to avoid any penalties. At BMS Auditing, we understand the importance of compliance with tax regulations and we strive to provide support for seamless tax compliance. Our team of tax experts is always available to assist you with any questions or concerns related to Excise Tax and VAT.
Penalty for Late Excise Return Filing
It is advised to always file the excise tax returns on time, even though you have already made the payment. Late filing of excise tax returns can result in a range of fines and penalties, depending on the severity of the violation and the duration of the delay. Some common penalties and fines for late filing of excise tax returns in the UAE include:
- Late filing fees: Businesses may be required to pay a fee for each day that they are late in filing their excise tax returns.
- Interest charges: Businesses may also be required to pay interest on any outstanding excise tax owed, based on the duration of the delay.
- Administrative penalties: The UAE Federal Tax Authority (FTA) may impose administrative penalties on businesses that fail to file their excise tax returns on time. The amount of the penalty will depend on the specific circumstances of the violation.
- Prosecution: In serious cases, the FTA may take legal action against businesses that repeatedly fail to file their excise tax returns on time. This may result in a criminal conviction and further fines or penalties.
What happens after importing Excise Goods in UAE?
After importing excise goods into the UAE, the importer becomes responsible for paying the excise tax, which is usually levied at a fixed rate based on the retail price of the goods. The exact amount of tax payable will depend on the type of goods being imported and the applicable tax rate.
The importer is also responsible for reporting and paying the excise tax to the Federal Tax Authority (FTA) in a timely manner. This may involve submitting tax returns, providing documentation, and making payments to the FTA.
The excise tax return is a document that must be submitted by registered and non-registered importers to the FTA on a regular basis. It must contain accurate information about the excise goods imported, including the retail price, the applicable tax rate, and the amount of excise tax payable.
Excise Tax Returns for Registered and Non-Registered Importers
Both registered and non-registered importers of these goods in the UAE are required to comply with the excise tax rules and regulations.
For registered importers, the process of filing excise tax returns involves submitting regular returns to the Federal Tax Authority (FTA), detailing the amount of excise tax payable and the relevant information about the goods being imported. This information must be accurate and complete, and the tax returns must be submitted on time to avoid any potential penalties or fines.
The information in the import declaration will be stored in the FTA system and linked to the importer's tax registration number (TRN).
For non-registered importers, the process of filing excise tax returns may be more complex. If the non-registered importer is importing the goods for their own use, they may be required to pay the excise tax directly to the FTA at the time of import. If the non-registered importer is importing the goods for resale, they may need to register for excise tax purposes and pay the tax in accordance with the relevant laws and regulations.
Before the goods pass through Customs, the importer must pay the applicable excise tax. The Customs Department will request the transaction ID and check the import declaration at the point of entry.
We do offer a comprehensive excise tax registration service in UAE to register for Excise tax and file the returns smoothly.
BMS Auditing has a team of experts who offers excise tax services in industry-oriented business reviews to ensure the right management of Excise Tax risk and exposure, thus identifying the opportunities for savings and minimizing the risk areas. Our experts advise on structuring business transactions, including cross-border transactions about Excise Tax in a cost-effective manner.
We provide the right assistance regarding registration and compliance duties. You will also be provided with professional training and regulatory updates.
Contact BMS Auditing Dubai, We are always delighted to serve you regarding any queries on Excise Tax Filing.