The World Health Organization (WHO) declared the Coronavirus (COVID-19) a pandemic on 11th March 2020. The UAE Government announced advisories and restrictions to limit the spread of the Coronavirus after which most companies are adapting to the process of work from home. In order to support the Companies, an announcement followed that FTA extends the tax period for Excise Tax.
The Federal Tax Authority (FTA) has decided to extend the tax period for businesses registered for Excise Tax, which commenced on 1/3/2020 for one month on an exceptional basis, to end on 30/4/2020. The tax period shall now cover the months of March 2020 and April 2020. This decision by FTA shows the commitment and support towards excise tax registered companies that are trying to deal with the consequences of precautionary measures taken by the UAE Government to control and contain the spread of COVID-19 in the country.
The Excise tax registrants must fulfill the following obligations –
- File two separate tax returns, one for March 2020 and one for April 2020, no later than Sunday, May 17, 2020.
- Ensure that the FTA has received the tax payable for the tax period as reported in the March 2020 and April 2020 tax returns no later than Sunday, May 17, 2020.
It must be noted that the FTA has decided only on the extension of Excise tax so far, no decision has been taken yet regarding the extension of the filing of VAT returns. All VAT registrants whose VAT returns are due on April 28th must file the returns before the due date to avoid penalties.