The Ministry of Finance announces the start of implementation of the amendments to the Tax Procedures Law in early 2026

ABU DHABI, 29 November / WAM / The Ministry of Finance announced the issuance of Federal Decree Law No. 17 of 2025 amending some provisions of Federal Decree Law No. 28 of 2022 regarding tax procedures, as part of the UAE’s ongoing efforts to enhance the efficiency of the tax system and establish the principles of transparency and fairness in tax transactions, to be effective as of January 1, 2026.

The amendments aim to establish a clearer and more organized legal framework for tax obligations and procedures, including regulating the time frame for requesting recovery of the credit balance with the Authority, so as to ensure clarity of rights and duties for both taxpayers and the Federal Tax Authority, and enhance financial discipline.

The amendments include specifying a period not exceeding “5” years from the end of the relevant tax period, to request a refund of the credit balance with the Authority, or using that balance to pay tax obligations, which provides a clear time frame for regulating these financial operations, while granting additional flexibility to submit a refund request if the credit balance arose after the expiry of the five-year period or during the last ninety days of it “in specific cases,” in a way that guarantees the rights of those subject to the tax and enhances financial certainty.

The amendments included expanding the provisions related to the statute of limitations, so that the Authority has the authority to conduct a tax audit or issue a tax assessment after the end of the statute of limitations, in certain cases, such as refund requests that were submitted in the last year of the statute of limitations, in order to achieve a balance between protecting the rights of those subject to the tax and ensuring the collection of state dues.

The amendments included granting the Authority the authority to issue official and binding directives to taxpayers and the Authority regarding the application of the provisions of the tax law to tax transactions, without prejudice to the provisions of the applicable tax legislation, which facilitates practical application, unifies interpretation, and reduces the risks resulting from discrepancies in dealing with different cases.

The amendments included transitional provisions that enable taxpayers who have credit balances with the Authority, and for whom the relevant five-year period has expired before January 1, 2026, or will expire within a year from that date, to submit refund requests within a year from January 1, 2026, in addition to the possibility of submitting a voluntary declaration related to that request within two years from the date of submitting the request, if the Authority has not yet issued a decision on it, in a way that ensures tax justice and enables all previous requests to be processed in a fair and flexible manner.

The Ministry of Finance confirmed that the new amendments embody the UAE’s approach to developing its financial policies in line with international best practices, and contribute to raising the efficiency of the tax system and improving the business environment by enhancing trust and transparency and reducing administrative burdens, in a way that supports the sustainability of public revenues and stimulates economic growth.

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