FTA Tax Audit in the UAE: What Happens, Your Rights and How to Prepare

An FTA tax audit is the Federal Tax Authority checking your records to see whether your VAT or corporate tax returns are right. You get at least 10 business days' notice, the audit can happen at the FTA's office or your premises, and the FTA can normally look back five years. Most audits are not about fraud. They are about whether the numbers on your returns match the invoices, contracts and bank statements behind them.

If you have just received a notice, take a breath. You have time to prepare, and you have rights. This guide explains what happens, what the auditor can ask for, and what to do if you disagree with the result. Everything here comes from the Tax Procedures Law (Federal Decree-Law No. 28 of 2022, as amended) unless we say otherwise.

The audit at a glance

Why the FTA picks a business

The law lets the FTA audit any person to check compliance, and it does not publish a list of triggers. In practice, the FTA compares your returns with other data it holds, so anything that looks out of line can draw attention: large refund claims, returns that swing a lot from one period to the next, figures that do not match what your suppliers or customers reported, or late and missing returns.

A refund claim is a common reason. The law even allows the FTA to hold back a refund while you are under audit, in certain conditions. If you file a big claim, assume someone will check it and have the invoices ready.

How much notice you get

The FTA must notify you at least 10 business days before the audit. You have the right to a copy of that notice.

There is one exception. An auditor can turn up without notice, and close the premises for up to 72 hours, if the FTA has serious grounds to suspect tax evasion, believes closing the place is needed to carry out the audit, or if you try to stop an auditor who was given notice from entering. Even then, the auditor needs written approval from the FTA's Director General first. This is rare for an ordinary small business.

Where and when it happens

The audit can take place at the FTA's own premises, at your place of business, or anywhere you trade, store goods or keep records. It runs during the FTA's official working hours, unless the Director General decides otherwise.

During the audit the auditor can take original records or copies, and samples of goods or other assets. You can ask for copies of anything they take.

What the auditor will ask for

Expect to be asked for the records behind your returns for the periods under review. Typically that means:

• sales and purchase invoices, and credit notes
• contracts for significant sales and purchases
• bank statements and your reconciliations
• your general ledger, trial balance and financial statements
• your VAT account showing output tax, input tax and adjustments
• import and export documents
• stock records and stock counts, if you hold inventory

The FTA can ask for documents in Arabic. You can keep records in English, but if the FTA requests a translation you must provide it at your own cost, and you are responsible for its accuracy. Since 14 April 2026 the penalty for not supplying documents in Arabic on request is AED 5,000.

The burden of proof matters here. Under the law, you have to prove your tax return is accurate. The FTA has to prove tax evasion. In plain terms: if a figure on your return has no paperwork behind it, expect it to be challenged.

Your rights during an audit

You are entitled to:

1. see the auditor's job identification card
2. get a copy of the audit notice
3. attend the audit if it takes place outside the FTA
4. get copies of any original paper or digital documents the auditor takes
5. see the documents and data the FTA used to work out any tax and penalties it assesses

You are also expected to cooperate. Refusing to help the auditor is a violation in its own right, and deliberately hiding or destroying records is a crime.

How far back the FTA can look

The normal limit is five years from the end of the tax period. There are exceptions:

• if you were notified of an audit before the five years ran out, the FTA has up to four years from that notice to finish
• if you submitted a voluntary disclosure or a refund application in the fifth year, the FTA gets extra time to review it
• in cases of tax evasion, or where a business failed to register when it should have, the limit is 15 years

This is one reason to keep records for at least five years after each tax period, and longer for anything linked to a refund claim. Our VAT compliance checklist covers what to keep.

Fix mistakes before the notice arrives

If you know a past return was wrong and you under-declared tax, the law says you must file a voluntary disclosure. Doing it before you are told about an audit matters: failing to disclose a known error before being notified of an audit is listed as a separate violation in the law.

So if you have a nagging feeling about an old return, check it now. A voluntary disclosure cannot be filed once five years have passed from the end of the tax period, with narrow exceptions.

After the audit: results and assessment

The FTA tells you the result of the audit. The Executive Regulation sets the timeframe, which is 10 business days from the end of the audit. If the FTA decides you owe more tax, it issues a tax assessment and tells you within 10 business days of issuing it. Penalties come in a separate administrative penalties assessment. By law, an administrative penalty cannot be more than twice the tax it relates to.

Where the FTA cannot work out the right figure because records are missing, it can issue an estimated assessment. That is a strong reason to keep complete books. An estimate made without your records is rarely in your favour.

If you disagree: review, reconsideration, objection, appeal

You have a clear route to challenge the outcome, but the deadlines are strict.

1. Review or reconsideration by the FTA. Within 40 business days of being notified, ask the FTA to review the assessment, or to reconsider its decision, giving your reasons. The FTA has 40 business days to decide and must tell you within 5 business days after that.
2. Objection to the Tax Disputes Resolution Committee. If you still disagree, object within 40 business days of the FTA's reconsideration decision. You must have filed a reconsideration request first, and you must have paid the tax in dispute in full. The Committee aims to decide within 20 business days. Its decision is final where the tax and penalties together are AED 100,000 or less.
3. Appeal to the federal court. For larger disputes, appeal within 40 business days of the Committee's decision. You must show the tax is paid and that at least 50% of the penalties are paid or covered by a bank guarantee.

Penalties can also be paid in instalments, reduced or waived by an FTA committee in some cases, under rules set by the Cabinet.

How to prepare, starting today

You do not need an audit notice to get ready. These habits make an audit short and boring, which is the best kind:

• Reconcile every month. Match bank statements to sales and purchases so every return figure traces back to a document.
• Keep a file per return. Save the return, the workings and the reconciliation together.
• Check every input tax claim has a valid tax invoice in your name.
• Keep contracts for large or unusual transactions.
• Fix known errors with a voluntary disclosure before anyone asks.
• Keep your FTA details current. Changes to your tax record must be reported within 20 business days.

If your books are behind, start there. Catch-up accounting brings old periods up to date, and monthly bookkeeping keeps them that way.

How TaxBox helps

Audits test the books, and keeping the books is our day job. Every TaxBox plan includes monthly bookkeeping and reconciliation, VAT return filing and corporate tax filing, so each figure on your return has records behind it. If you have received an audit notice or are worried about a past return, speak to a tax consultant in Dubai on our team, or get an instant quote for ongoing support.

Frequently asked questions

How much notice does the FTA give before a tax audit? At least 10 business days, under Article 16 of the Tax Procedures Law. The FTA can enter without notice only in limited cases, such as serious grounds to suspect tax evasion, and only with the Director General's written approval.

How many years back can the FTA audit? Normally five years from the end of the tax period. It can go back 15 years where there is tax evasion, or where a business should have registered and did not.

Can I still make a voluntary disclosure after an audit notice? The law treats an error disclosed before the audit notice differently from one that comes out afterwards. Failing to disclose a known error before being notified of an audit is a separate violation, so correct mistakes as soon as you find them.

What can I do if I disagree with an FTA tax assessment? Ask the FTA to review the assessment or reconsider its decision within 40 business days of being notified. If you still disagree, you can object to the Tax Disputes Resolution Committee within 40 business days, after paying the tax in dispute, and then appeal to the federal court.

Do I need a tax agent for an FTA audit? No, but you can appoint an FTA-registered tax agent to represent you. Your business stays legally responsible either way, so the most useful preparation is accurate books and complete records.

Sources

• Federal Tax Authority: Federal Decree-Law No. 28 of 2022 on Tax Procedures, consolidated with amendments
• Federal Tax Authority: Cabinet Decision No. 74 of 2023 on the Executive Regulation of the Tax Procedures Law
• Federal Tax Authority: Entry into force of Cabinet Decision No. 129 of 2025 on administrative penalties
• Federal Tax Authority: Tax dispute resolution
• UAE Government portal: Resolving tax disputes
• Federal Tax Authority: Get to know your tax obligations

This article is general information, not tax or legal advice. If you have received an audit notice or assessment, get advice on your specific facts. Rules, deadlines and penalty amounts change, so check the Federal Tax Authority before you act.