All registered taxpayers in the UAE must submit VAT returns on a monthly or quarterly basis. If the output VAT in the VAT return is higher than the recoverable input VAT, the difference will result in a VAT liability that needs to be paid to a free trade agreement. The steps to pay VAT are listed below.
Steps to pay VAT
After submitting the VAT return, the VAT payable and other liabilities (such as fines) that the taxpayer needs to pay will be displayed under “My Payments” on the FTA portal. The following are the steps to check and pay VAT liabilities:
1. Use your username and password to log in to FTA (https://eservices.tax.gov.ae)
2. Navigate to “My Payments” in the portal panel
3. Under “Value Added Tax and Penalty Payment” on the next page, the amount the taxpayer needs to pay will be displayed as “Total Unliquidated Debts”
4. Under the total outstanding debt, mention the amount you want to pay, and then click “Pay”, as shown below:
Please note that partial payment is possible. However, please make sure you pay in full before the due date to avoid fines. Similarly, older liabilities will be paid off first, and then newer liabilities, for example, if you pay, you will pay January’s VAT refund liabilities before February’s VAT refund liabilities
5. After clicking “Pay”, you will be directed to “Payment Information” as shown below:
Click the “Pay Now” button to continue the payment. It will be directed to the e-Dirham gateway.
6. After being redirected to the e-Dirham gateway, you will be able to pay via e-Dirham or non-e-Dirham cards.
Type of payment
7. After confirming the transaction and successfully processing the VAT payment, you will be redirected to the FTA website.
You can view transaction history and payments under “VAT transaction history” in the “My Payments” tab, as shown below.
This includes payments for your transactions and periodic VAT refunds, as well as any penalties related to VAT refunds (if applicable). For example, late declaration or VAT refund payment.
Penalties for late payment of value-added tax
After submitting the VAT return, the taxpayer must ensure that the payment is completed within the timetable. Failure to pay before the due date will result in late fees, as shown below:
a. 2% of unpaid taxes collected immediately after late payment of taxes
b. The 4% tax shall be paid on the seventh day after the payment deadline, but the amount of tax still payable is 6% of the tax.
C. For any amount not paid within one calendar month after the payment deadline, a daily penalty of 1% will be charged, up to a maximum of 300%.