VAT Voluntary Disclosure in UAE: When & How to File

A VAT Voluntary Disclosure is a formal mechanism for UAE businesses to correct errors or omissions in their VAT returns or related filings. It allows taxpayers to notify the Federal Tax Authority (FTA) of mistakes in previously submitted returns and make necessary corrections. Timely voluntary disclosures help businesses remain compliant and avoid severe penalties by rectifying underpaid tax or overclaimed refunds in an approved manner.

Key Takeaways

• Voluntary Disclosure (Form 211) allows taxpayers to notify the FTA of errors in VAT returns, tax assessments, or refund claims.
• Starting from March 2023. Now, all errors regardless of amount must be disclosed within 20 business days of discovery.
• The disclosure should be filed online via the FTA portal, where businesses must submit corrected figures and provide a clear explanation of discrepancies.
• While fixed penalties apply (AED 1,000–2,000), prompt disclosure reduces percentage-based penalties from 50% to as low as 5%.

What is VAT Voluntary Disclosure in the UAE?

In the UAE, a VAT Voluntary Disclosure is a formal correction mechanism that allows taxable persons to amend errors in previously filed VAT returns, tax assessments, or refund applications. By filing through FTA Form 211 on the FTA portal, businesses can declare the correct figures and settle any underpaid VAT or excess refunds received.

Until March 2023, businesses were only required to disclose errors that caused more than AED 10,000 in underpaid tax, with more minor discrepancies allowed in the next return. However, following regulatory updates, all errors, regardless of amount, must now be disclosed within 20 business days of discovery. This extends even to non-monetary mistakes such as misclassified supplies or reporting sales under the wrong Emirate.

By filing voluntarily, businesses demonstrate transparency and reduce penalties compared to if discrepancies are later found during an FTA audit, making it an essential compliance safeguard.

When Should You File a Voluntary Disclosure?

A voluntary disclosure should be filed as soon as you become aware of an error or omission in a VAT return, tax assessment, or refund claim that makes the original filing inaccurate. The Federal Tax Authority (FTA) requires timely correction, and as of 1 March 2023, even small errors must be formally disclosed. Below are the key situations where filing is required:

• Underpaid VAT above AED 10,000 (historical rule):  Previously, if your VAT return understated tax payable by more than AED 10,000, you had to file a disclosure (FTA guidance). Minor errors could be adjusted in the next return.
• Overclaimed refunds of any amount:  If a refund claim resulted in receiving more VAT back than you were entitled to, you must disclose and correct it . Even small overclaims are treated as underpaid tax.
• Errors not affecting tax due: As of 2025, even non-monetary errors, like misreporting the Emirate of supply or misclassifying zero-rated vs exempt sales, require disclosure so that the FTA has an accurate record.
• Incorrect FTA assessments: If the FTA issues a tax assessment you believe is wrong, you can use a voluntary disclosure to correct the record.
• Strict 20-day timeline: Once you become aware of an error, you must file Form 211 within 20 business days. Missing this window can lead to penalties.

Step-by-Step Process to File a VAT Voluntary Disclosure in UAE

Filing a voluntary disclosure in the UAE is done through the Federal Tax Authority’s EmaraTax e-Services portal.  Here is how you can file a Voluntary VAT Disclousre in UAE 

• Identify the error – confirm the tax period, type of mistake, and collect supporting documents.
• Prepare an explanation – draft a clear note explaining the error, cause, and correction.
• Log in to FTA’s EmaraTax portal with your TRN credentials.
• Select the relevant tax period – under VAT returns, click “Submit Voluntary Disclosure” (Form 211).
• Fill out Form VAT 211 – enter discovery date, corrected figures, and error explanation.
• Upload supporting attachments – invoices, statements, or calculations to justify corrections.
• Review summary and confirm – check adjustments to VAT payable/refundable, then submit.
• Pay dues and penalties – settle additional VAT (within 20 business days) and the fixed penalty (AED 1,000 or AED 2,000).
• Keep records – save the disclosure reference, documents, and update internal accounts.

While the system guides you through the process, accuracy and clarity are critical. Below is a step-by-step breakdown of how businesses should file.

1. Identify the Error and Gather Documentation

Before starting on the portal, confirm the exact nature of the mistake. Identify the affected tax period and whether it involves output VAT, input VAT, refund claims, or other data. Collect supporting invoices, contracts, or reconciliations. Prepare a short written explanation describing the error, why it occurred, and how you arrived at the corrected figures. This narrative will be uploaded or entered in the disclosure form.

2. Log in to the FTA Portal

Access the FTA EmaraTax portal and log in with your Tax Registration Number (TRN) credentials. Go to the VAT section of your dashboard. If you manage multiple entities, ensure you select the correct taxable entity before proceeding.

3. Select the Tax Period and Access the Disclosure Option

Under the VAT tab, you will see a list of your submitted VAT returns (labeled “VAT201”) and other filings. Locate the relevant tax period and click “Submit Voluntary Disclosure” (form “VAT211”). If you are correcting an FTA-issued assessment or a refund application, go to the respective tab and choose the disclosure option. Note that only one disclosure can be submitted per tax period. If an error is found later, you may need to combine corrections into one form.

4. Complete Form VAT 211

The disclosure form is pre-populated with your TRN, taxpayer details, and “as reported” figures. You will need to:

• Enter the date the error was discovered.
• Provide a detailed explanation of the mistake, including the affected return boxes and the cause (for example, “invoice omitted due to clerical oversight”).
• Enter the corrected figures for each relevant box. The system will automatically calculate the difference compared to the original return.
• Upload supporting attachments such as invoices, calculation sheets, or a signed explanation letter. While not always mandatory, attaching proof helps the FTA review your case more efficiently.

5. Review the Adjustments

The system will show a summary of the corrected amounts and the impact on tax payable or refundable. If additional VAT is due, the liability will be displayed. If the correction reduces your tax liability, the FTA may review the claim in greater detail before approving a refund.

6. Submit and Acknowledge

Review all details carefully, tick the declarations, and submit the form. You will receive a confirmation along with a unique reference number. Save this acknowledgment for your records.

7. Pay the Additional Tax and Penalty

If the disclosure results in extra VAT payable, you must pay it within 20 business days of filing to avoid late payment penalties. A fixed administrative penalty also applies: AED 1,000 for the first voluntary disclosure and AED 2,000 for subsequent disclosures. The system will show these amounts under your account, and payment can be made through e-Dirham or bank transfer.

8. Await FTA Review

After submission, the status will show “Pending” or “Under review.” In straightforward cases, the FTA will update your records without further queries. If additional clarification is needed, the FTA may request documents or explanations.

9. Maintain Records

Keep copies of the disclosure form, reference number, and supporting evidence. Update your internal accounting records so they match the corrected figures. These records may be important for audits or future compliance checks.

Penalties for Late or Incorrect Voluntary Disclosure

Voluntary disclosure helps correct VAT errors in the UAE, but it carries penalties to enforce timely, accurate compliance. Here we break down the key penalties related to voluntary disclosures:

How to Avoid the Need for Voluntary Disclosure

While the voluntary disclosure process is useful, the best approach is to avoid needing it by preventing VAT errors upfront. Strong processes, technology, and regular checks can keep filings accurate. Key practices include:

• Implement robust accounting controls – record invoices accurately, reconcile VAT returns, and perform internal checks.
• Use VAT-compliant software to automate calculations, apply correct tax codes, and reduce manual mistakes.
• Stay updated on VAT rules through FTA clarifications, newsletters, and workshops.
• Conduct periodic VAT health checks with internal or external reviews.
• File and pay on time to avoid rushed errors and late complications.
• Maintain proper documentation for all invoices, credit notes, and records for at least 5 years.
• Train staff regularly so finance and operations teams apply VAT correctly.
• Seek expert advice on complex transactions before filing.
• Apply review checklists and approvals to catch mistakes before submission.

Conclusion

Voluntary disclosure in the UAE is essentially about transparency and trust. Businesses, as a taxpayer should keep the trust of the tax authority by being open about mistakes. When managed correctly, it turns a potentially costly problem into a manageable task.

Relying on voluntary disclosures should not be a strategy, it’s a remedial measure. The ultimate aim for any VAT-registered business is to file error-free returns and avoid the need for corrections. Through strong internal controls, thorough reviews, and staying informed on VAT rules, businesses can minimize errors and the consequent necessity of Form 211 filings.