UAE Tax Records Update: 20-Day Compliance Rule for VAT and CIT

The UAE has implemented strict tax compliance regulations under Cabinet Decision No. 74 of 2023. Businesses are now required to update their tax registration records with the Federal Tax Authority (FTA) within 20 business days of any relevant changes. This rule applies to both Value Added Tax (VAT) and Corporate Income Tax (CIT), ensuring transparency and accountability in the UAE tax system.

VAT: Mandatory Record Updates

VAT-registered businesses in the UAE must maintain accurate and current records with the FTA. Any changes to business address, legal structure, contact information, or business activities must be reported within 20 business days. Failure to comply with this requirement may result in administrative penalties. Timely updates help businesses avoid fines and maintain good standing with the tax authorities.

Why is the 20-Day Rule Important for Businesses?

Timely updates ensure that businesses remain in good standing with the FTA and avoid costly penalties. This rule also enhances business credibility, as updated tax records demonstrate transparency and compliance with UAE law.

Corporate Income Tax (CIT): Timely Notification of Changes

With the introduction of Corporate Income Tax in the UAE, businesses earning taxable profits must also adhere to the 20-day update rule. This includes notifying the FTA of changes in ownership, shareholding, financial year, or business operations. Keeping tax records up-to-date is a legal obligation and supports efficient tax administration.

Key Sectors Impacted by the UAE Tax Compliance 2025 Update

While the rule applies across all industries, it is particularly important for:

  • SMEs operating under VAT registration.
  • Companies are newly subject to Corporate Tax.
  • Businesses undergoing structural or ownership changes.

By understanding which changes must be reported, organizations can safeguard themselves from non-compliance issues.

Conclusion

Whether under VAT or CIT, the 20-day window for updating tax records is a critical compliance requirement in the UAE. Businesses should implement internal controls to monitor changes and ensure timely communication with the FTA. Staying compliant not only avoids penalties but also promotes a culture of transparency and trust in the UAE’s evolving tax landscape.

At Accountant’s Box, our mission is to make complex tax compliance updates simple and clear for businesses in the UAE. We provide practical insights on VAT, Corporate Income Tax, and other key regulations so that companies can make informed decisions and stay ahead of deadlines. If there’s a specific compliance topic you’d like us to cover, we’d be happy to help. Don’t miss our recent guide: UAE Corporate Tax Return Filing (2025): Steps for Businesses & Individuals — it offers step-by-step support for staying compliant. We specialize in assisting SMEs with VAT updates, corporate tax filings, and FTA compliance requirements. To connect with us, drop an email at info@accountantsbox.com.