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Document Type: PC - Public Clarification
Guidance Code: TAXP006
Year: 2023
Related Law: uae-cit-fdl-47-of-2022
Authority: Federal Tax Authority

Issuance of a New Tax Procedures Executive Regulation - TAXP006

TAXP006 - Issuance of a New Tax Procedures Executive Regulation

TAXP006

Tax Procedures Public Clarification

Issuance of a New Tax Procedures Executive Regulation

Issue

The tax procedures in the UAE are regulated by Federal Decree-Law No. 28 of 2022 on Tax Procedures (“Decree-Law”) and its Executive Regulation. Cabinet Decision No. 74 of 2023 (“New Executive Regulation”) repealed Cabinet Decision No. 36 of 2017 on the Executive Regulation of Federal Law No. 7 of 2017 on Tax Procedures, and its amendments (“Previous Executive Regulation”), with effect from 1 August 2023.

Many of the provisions of the Previous Executive Regulation were incorporated in the New Executive Regulation.

This Public Clarification is intended to inform persons of the changes made in the New Executive Regulation where these differ from the provisions of the Previous Executive Regulation.

Articles that remained materially the same (except for renumbering) are not covered by this Public Clarification.

Summary

The main changes in the New Executive Regulation are in relation to the following topics:

  • Definitions (Article 1) [1]

  • Recordkeeping (Articles 2 and 3) [2] [3] [4] [5]

  • Language (Article 5) [6]

  • Registration, de-registration and amending details of registration (Article 6) [7] [8]

  • UAE Licensing bodies (Article 7) [9]

  • Submission of voluntary disclosure (Article 10) [10]

  • Means of notification (Article 11) [11]

  • Natural person and juridical person tax agents (Articles 12 - 14) [12] [13] [14] [15] [16] [17] [18] [19] [20] [21] [22]

  • Tax audits (Articles 15 - 19) [23]

  • Reconciliation in tax evasion crimes (Articles 23 and 24) [24] [25] [26] [27] [28]

  • Extension of deadlines (Article 25) [29] [30] [31] [32]

  • Payment of tax and administrative penalties in cases of bankruptcy (Article 27) [33]

The detailed analysis below highlights the differences between the Previous Executive Regulation and the New Executive Regulation and provides further clarification on new or updated provisions.

Detailed analysis

Definitions (Article 1) [1]

The number of definitions has been limited under Article 1 of the New Executive Regulation as the definitions under Article 1 of the Decree-Law also apply for the New Executive Regulation. When reviewing their legal obligations and rights, all persons must ensure they refer to the definitions in the Decree-Law in conjunction with the provisions of the New Executive Regulation.

The definition of the term "assets" has been expanded to include intangible assets. This means that the definition includes, for example, patents, brands, licenses, trademarks, computer programs, copyrights, goodwill and also customer lists. The definition of assets has a particular importance for the application of Article 18 of the New Executive Regulation.

Accounting records and commercial books (Article 2) [2]

In addition to the records and books of the business, businesses must also retain all documents that support entries in the accounting records and commercial books of the business.

This includes, but is not limited to:

  • Relevant correspondence, invoices and tax invoices, licenses and agreements/contracts related to the business.

  • Documents containing details of any election, determination or calculation made by a taxable person in relation to its tax affairs, including the basis, method of estimation, determination made and calculation performed.

  • Documents with respect to related party transactions and with respect to the circumstances under which such transactions were made, including, for example, transfer pricing documents.

Period of record keeping (Article 3) [3] [4] [5]

All accounting records, commercials books and all documents and information referred to under Article 2 of the New Executive Regulation are to be held in a way to enable the FTA to conduct its tax audits and verify a person's compliance with its tax obligations. They must also be maintained for defined periods depending on whether a person is a taxable person or not or depending on the nature of the record or document.

  • The New Executive Regulation specifies that, for real estate records, the retention period is seven years from the end of the calendar year in which such record or document was created.

    For example, if a property was sold on 2 January 2025, the end of the calendar year in which the record is created would be 31 December 2025. Consequently, the related records and accounts must be retained until 31 December 2032.

  • The general document retention period of five years will be extended by one year starting from the date of submission of a voluntary disclosure in the fifth year from the end of the relevant tax period.

    This means, for example, that a taxable person who discovers an error requiring a voluntary disclosure related to a tax period ending on 31 December 2019, and submits the voluntary disclosure application on 14 June 2024 (i.e. in the fifth year from the end of the relevant tax period), the person is required to retain the related records until 14 June 2025 although the retention period previously would have ended on 31 December 2024, except for real estate records and related documents.

  • Legal representatives, as defined under Article 1 of the Decree-Law, are required to retain the required books and records of the person they are representing for a period of one year from the date on which such legal representation ends.

    The retention periods under Article 3(1) and (2) of the New Executive Regulation remain applicable when a person has been appointed a legal representative and will continue to apply in the event that legal representation ends for that person. The period of one year is an onus on the legal representative.

Language (Article 5) [6]

Under the Previous Executive Regulation, the tax return, data, information, records and any other documents related to tax, had to be submitted, by default, to the FTA in Arabic.

Under the New Executive Regulation, the FTA may now accept the tax return, data, information, records and any other documents related to tax to be submitted in English or Arabic.

If the documents were submitted in English, the FTA may, at its discretion, request to translate some or all documents into Arabic within a period that the FTA will specify in its request. The translation into Arabic must be approved in accordance with the law regulating translations in the UAE, which implies the requirement of using a translator who is on the translators list as defined under the Federal Law No. 6 of 2012.

Procedures relating to Tax Registration, Deregistration, and Amending Details of Registration (Article 6) [7] [8]

Under the New Executive Regulation, the list of instances is expanded in which registrants are required to notify the FTA of changes to their business data to include notification of the following changes:

  • E-mail address.

  • Trade licence activities.

  • Legal status and partnership agreement for unincorporated partnerships.

The FTA may, according to the New Executive Regulation, at its discretion but in accordance with the relevant Tax law, deregister a registrant where the person is required to deregister for a specific tax type but fails to submit a deregistration application.

This would, for example, include the following instances:

  • A person continuously submits nil returns for Excise Tax, or where the value of supplies/taxable expenses do not meet the voluntary registration threshold for the purposes of VAT registration.

  • A person registered for Excise Tax ceases to manufacture or import excise goods.

UAE Licensing bodies (Article 7) [9]

Under the Previous Executive Regulation, with respect to trade licences, and now under Article 7 of the New Executive Regulation, licensing bodies in the UAE must now also notify the FTA, within 20 business days of any issuance or renewal, of a number of data regarding the license.

This obligation for licensing bodies does not exonerate the concerned registrant from his obligations under Article 6(4) of the New Executive Regulation.

Voluntary disclosure (Article 10) [10]

If a taxpayer becomes aware of an error or omission in a tax return submitted to the FTA that did not impact on the due tax for that tax period, the person is required to submit a voluntary disclosure to rectify the error.

Errors with no impact on due tax include:

  • Failing to report imported services, where the business is entitled to full input tax recovery in respect of the supply.

  • Reporting supplies in Box 1 of the VAT return against an Emirate other than the Emirate in which supplies should have been recorded.

Means of notification (Article 11) [11]

The means of notification by the FTA towards a person now also includes text messages on mobile phones, notifications through smart applications, and notifications through the FTA's electronic systems. With respect to smart application, it should be noted that the FTA's mobile application can be downloaded by both iOS and Android users since 17 April 2023 and 15 May 2023, respectively.

As under the Previous Executive Regulation, postings of notifications in the premises of the person must be made on a prominent place such as the reception area. Any other means to be used for the notification than the means listed under Article 11 of the Executive Regulation, must be agreed in writing by the person and the FTA. A verbal agreement will not be in line with the New Executive Regulation.

Tax Agents - Natural persons (Article 12) [12] [13] [14]

With the introduction of Corporate Tax in the UAE, the system of tax agents in the UAE is being updated. The updates are around specialism, experience required, education, registering as natural vs. juridical persons, language, procedures for tax agent listing and renewal and professional behaviour and integrity.

The New Executive Regulation provides the legal framework for the system of tax agents and this framework will be further regulated through Decisions that will, amongst others, clarify requirements around continuous professional development, the national and international bodies that the FTA will recognise who can provide valid professional certification for the purposes of registering tax agents, and the number of natural person tax agents required for a juridical tax agent to be listed.

A natural person wishing to register as a tax agent must have at least the following education and relevant tax, accounting or legal experience:

  • Three years relevant experience obtained in the preceding five years, plus a Bachelor or Masters degree in tax, accounting, or law from an educational institution recognized by the UAE competent authorities. The certification of the degree must be done in line with the UAE applicable legislation;

  • Three years relevant experience obtained in the preceding five years plus a Bachelor or Masters degree in any other field (other than tax, accounting, or law) from an educational institution recognized by the UAE competent authorities, and a valid professional qualification from an approved institution as specified by the FTA for purposes of presenting such qualification. The certification of the degree must be done in line with the UAE applicable legislation; or

  • Five years relevant experience obtained in the preceding eight years plus a Bachelor or Masters degree in any field from an educational institution recognized by the UAE competent authorities. The certification of the degree must be done in line with the UAE applicable legislation.

The natural person tax agent shall need to pass a qualification test, as will be specified by the FTA, whereby distinct tests will be in place for indirect tax and Corporate Tax. The tax agent shall also complete the necessary training, which will be on an ongoing basis, as specified by the FTA.

It is no longer a requirement for the tax agent to:

  • Be able to communicate in both Arabic and English as fluency in either of these languages is acceptable.

  • Submit proof that the person is medically fit to perform the duties of the profession.

Members of the Tax Dispute Resolution Committee are not allowed to be registered as tax agents.

Tax agents - Juridical persons (Article 12) [15]

The concept of a juridical person tax agent has been added in the UAE tax legislation. To be registered as tax agent, a juridical person tax agent must meet the following requirements:

  • Hold a trade license reflecting that the legal person is licensed as an audit, tax or law firm.

  • Hold or be covered under a valid professional indemnity insurance that is appropriate to the nature and size of the business.

  • Have at least one partner or director who meets all of the requirements to be eligible to register and registers with the FTA as a natural person tax agent who supervises the services provided by the juridical person, and does not work for another juridical person or for its benefit.

  • Meet any additional conditions prescribed by the FTA.

It must be noted that tax agents will be listed separately as Corporate Tax and Indirect tax (VAT and Excise Tax) agents. Separate training and qualifying examinations will be specified or prescribed.

A tax agent can be listed for both Corporate Tax and Indirect tax but can only represent a person for the category that he has been appointed for by that person.

Tax agents - Listing and de-listing (Article 13) [16] [17] [18] [19] [20] [21]

The New Executive Regulation stated detailed procedures for listing and delisting tax agents, including:

  • If a person fails to pay the relevant fees to be listed as a tax agent within 20 business days from the date of being notified of meeting the tax agent eligibility criteria, the application to be listed as a tax agent is considered to be cancelled.

    In such instance, a new application may be submitted if the person wishes to be listed as a tax agent.

  • Every natural person tax agent is required to renew his/her tax agent registration every three years whereas juridical tax agents are required to renew their registration every year.

    Renewal applications have to be submitted at least twenty business days before the expiration of the tax agent's listing, and the relevant renewal fee has to be paid to the FTA within the prescribed period.

  • Any renewal request submitted later than 20 business days before the date the listing expires, is treated as a new application and not a renewal request.

    If a tax agent fails to apply for a renewal before the expiry of the listing, the person will be removed from the tax agent list and the person will no longer be allowed to practice as a tax agent.

    In such instance, the person may submit a new application (including all the required documents) to be listed as a tax agent.

    Furthermore, the person will be delinked from all taxpayers for which the person acted as tax agent.

The FTA is obliged to de-list a tax agent if:

  • It was proven to the FTA that the tax agent is unable to fulfil its duties or functions, or no longer meets the conditions to be eligible to be listed as a tax agent.

  • The FTA has serious grounds to believe that the continued listing of the person as a tax agent would adversely affect the integrity of the tax system in the UAE.

  • The tax agent committed a serious violation of the provisions of the Decree-Law or the tax law, or committed, participated in or facilitated tax evasion.

  • The FTA becomes aware that the tax agent is a current member of the Tax Dispute Resolution Committee.

Tax agents - Obligations and rights (Article 14) [22]

In addition to the obligations in the Previous Executive Regulation, the following have been added:

  • Tax agents have to meet continuing professional development (CPD) requirements, as specified by the FTA.

  • Tax agents are required to retain information, documents, records and data in respect of any person the tax agent represents.

Tax audits (Article 16) [23]

Under the New Executive Regulation, the FTA is now required to give a person at least 10 business- day notice before conducting a tax audit.

Overall, the procedures of the tax audit and the rights and obligations remain the same as already in effect. The New Executive Regulation contains some changes and updates, including:

  • The right for the FTA auditor to also mark original documents for the purpose of indicating that they have been inspected.

  • In its record of what was removed for tax audit purposes, to be provided by the FTA, the FTA must include not only the nature of a document that was removed but also a description of this document. This is for the purposes of increased clarity and legal certainty.

  • In case the FTA intends to dispose of an asset, it can also notify other specified persons instead of the owner of the asset, of its intention where notification of the owner is not possible.

  • A request from a person to view or obtain documents, data and information on which the FTA based an assessment of due tax, shall be met by the FTA within 10 business days (previously 20 business days) from the date of receiving the request, but subject to the exceptions under Article 19(4) of the New Executive Regulation.

Reconciliation process - Tax Evasion crimes (Articles 23 and 24) [24] [25] [26] [27] [28]

For tax evasion crimes and the deliberate failure to settle administrative penalties, a person may submit a reconciliation application to the FTA before the initiation of the criminal case, provided that the person undertakes to settle the full amounts of payable tax and administrative penalties to the FTA as consideration for the reconciliation.

Also, before a criminal case is initiated, for the specific tax crimes that are specified under Article 25(4) of the Decree-Law, and where these crimes resulted in tax evasion or facilitated or concealed tax evasion, the person must first make a payment of AED 50,000 before the FTA may reconcile. Reconciliation shall be made by settling the full amounts of payable tax and administrative penalties to the FTA.

If the FTA accepts the reconciliation application, a record shall be issued containing proof of the reconciliation and its consideration. This document has to be signed by both parties, i.e. the FTA and the person who submitted the reconciliation application. The FTA will provide a copy of such record to the person after payment of the full consideration for the reconciliation.

The accused or convicted person may submit a reconciliation application to the competent federal public prosecution at any stage of the criminal case. The public prosecution shall seek the FTA's opinion before proceeding with reconciliation procedures in tax crimes.

Depending on the stage of the criminal case, also including the stage after issuance of a conviction judgement, and on the nature of the tax crime, reconciliation can be made subject to settling the full amount of payable tax and administrative penalties plus an additional amount calculated as a percentage of the tax evaded and, in some cases, plus an additional fixed amount.

If the public prosecution accepts the reconciliation application, it shall issue a record of reconciliation after the full settlement of the full tax and administrative penalties payable and additional consideration for the reconciliation.

The record must be signed by both the competent public prosecution member and the accused or convicted person, approved by the federal attorney general, and include the following:

  • The details of the accused or convicted person.

  • A description of the charges attributed to the accused or the convicted person, the date and place of their occurrence and the articles of law applicable thereto.

  • The value of the tax and administrative penalties payable.

  • The percentage and value of the additional amount of consideration for the reconciliation.

Extension of deadlines (Article 25) [29] [30] [31] [32]

The FTA may extend the deadline for deciding on a tax assessment review request and a request for reconsideration for a period of 20 business days if the extension is necessary to decide on the request.

The FTA may, at the request of the concerned persons, extend the deadline for accepting the submission of a tax assessment review request or a reconsideration request, in the cases deemed appropriate by the FTA.

The Tax Disputes Resolution Committee may extend the deadline for deciding on a Tax objection for a period of 60 business days if the extension is necessary to decide on the objection.

The Tax Disputes Resolution Committee may, at the request of a concerned person, extend the deadline for accepting the submission a tax objection if the late submission of the tax objection was due to circumstances beyond the person's control, sudden accident, emergency circumstances or force majeure that prevented them from submitting the tax objection within the specified period.

Bankruptcy (Article 27) [33]

The FTA shall notify the appointed bankruptcy trustee of the amount of the due tax in respect of the business subject to bankruptcy and, where applicable, of its intention to perform a tax audit for specific tax period(s), within 20 business days after being notified of the trustee's appointment.

Abrogation (Article 30) [34]

Decisions issued by the FTA and procedures applied by it for the implementation of the Previous Executive Regulation shall remain in force, insofar as they do not contradict with the provisions of the New Executive Regulation until the issuance of decisions and procedures replacing them.

Effective date (Article 31) [35]

The New Executive Regulation shall be published in the Official Gazette and come into effect on 1 August 2023, except for the provisions relating to the conditions for registering juridical tax agents which comes into effect on 1 December 2023. This 1 December date allows juridical persons to prepare for compliance with the conditions to be listed as tax agents.

This Public Clarification issued by the FTA is meant to clarify certain aspects related to the implementation of Cabinet Decision No. 74 of 2023 on the Executive Regulation of Federal Decree-Law No. 28 of 2022 on Tax Procedures.

This Public Clarification states the position of the FTA and neither amends nor seeks to amend any provision of the aforementioned legislation. Therefore, it is effective as of the date of implementation of the relevant legislation, unless stated otherwise.

Legislative References:

In this clarification, Cabinet Decision No. 74 on the Executive Regulation of Federal Decree-Law No. 28 of 2022 on Tax Procedures is referred to as "New Executive Regulation".

Footnotes

[1] Article 1 of the New Executive Regulation defines the term “asset” as tangible and intangible assets, including equipment, machinery, goods and others, which the FTA considers to be owned, leased or used in connection with the conduct of business by any person.

[2] Article 2(1)(b) of the New Executive Regulation states that all documents supporting the entries in the accounting records and commercial books, including but not limited to:

  1. Correspondence, invoices, licenses and contracts related to the Business.

  2. Documents containing details of any election, assessment, determination or calculation made by a taxpayer in relation to the tax affairs of its business, including the basis, or method of assessment, determination or calculation made.

[3] Article 3(1)(c) of the New Executive Regulation states that all accounting records, commercial books and information shall be retained and maintained in a way that enables the FTA or any employee authorised by it to verify the tax obligations imposed on the person concerned for a period of (7) seven years from the end of the calendar year in which the concerned document was created for real estate records, unless the tax law states otherwise.

[4] Article 3(2)(d) of the New Executive Regulation states that, in addition to the periods specified in Clause (1) of this Article, the person shall retain the books and records for an additional period of (1) one year starting from the date of submission of a voluntary disclosure in respect of the taxable person that submits a voluntary disclosure in the fifth year from the end of the relevant tax period.

[5] Article 3(3) of the New Executive Regulation states that, subject to Clauses 1 and 2 of this Article, the legal representative shall retain the books and records of the person he is representing for a period of (1) one year from the date on which such legal representation expires.

[6] Article 5(2) of the New Executive Regulation states that the translation of any tax return, data, information, records, documents or other books into Arabic must be approved in accordance with the law regulating translation in the UAE, and submitted to the FTA within the period it specifies.

[7] Article 6(4) of the New Executive Regulation states that a registrant shall notify the FTA, in the form and manner approved by it, within (20) twenty business days of any change to their data kept with the FTA, including:

  1. Name, address and email address.

  2. Trade licence activities.

  3. Legal entity type, partnership agreement for unincorporated partnerships and articles of association or its equivalent.

  4. Nature of the business of the Registrant

  5. The address from which any business is conducted by the registrant.

[8] Article 6(7) of the New Executive Regulation states that, in cases where the registrant does not submit a deregistration application, the FTA may deregister such registrant in accordance with the controls and procedures stated in the tax law.

[9] Article 7 of the New Executive Regulation states that the government entities that grant licences to persons carrying out business shall, within (20) twenty business days of the issuance or renewal of the licence, notify the FTA in the manner specified by it. The notification shall include the following:

  1. The name of the licensee.

  2. The type, number and date of issuance of the trade licence.

  3. The registered address of the licensee.

  4. Description of the activities of the business.

  5. The details of the owners, partners and directors.

  6. Any other information requested by the FTA.

[10] Article 10(3) of the New Executive Regulation states that if a taxpayer becomes aware of an error or omission in the tax return submitted to the FTA without there being a difference in due tax, the taxpayer shall correct the error or submit a voluntary disclosure to the FTA as may be specified by the FTA.

[11] Article 11(1) of the New Executive Regulation states that the FTA shall notify the person, its tax agent or legal representative, as applicable, at the address registered with the FTA by any of the following means:

  1. Post, registered post, email, mobile text message, smart applications or the electronic system of the FTA.

  2. Posting in a prominent place in the premises of the person.

  3. Any other means as may be agreed in writing by the person and the FTA.

[12] Article 12(1)(c) of the New Executive Regulation states that a natural person wishing to be listed in the register of tax agents shall have the minimum education and relevant experience in tax, accounting or law, in any of the following forms:

  1. Experience of at least (3) three years obtained in the last (5) five years and hold at least a certified bachelor degree or masters in tax, accounting or law from an education institution recognised by the competent authority in the UAE.

  2. Experience of at least (3) three years obtained in the last (5) five years and hold a certified bachelor degree in any other field from an educational institution recognised by the competent authority in the UAE, in addition to a valid professional qualification from a recognised institution, as may be prescribed by the FTA.

  3. Experience of at least (5) five years obtained in the last (8) eight years and hold a certified bachelor degree in any other field from an education institution recognised by the competent authority in the UAE.

[13] Article 12(1)(e) of the New Executive Regulation states that a natural person wishing to be listed in the register of tax agents shall have the ability to communicate orally and in writing in Arabic or English.

[14] Article 12(1)(h) of the New Executive Regulation states that a natural person wishing to be listed in the register of tax agents must not be a current member of the Committee.

[15] Article 12(2) of the New Executive Regulation states that a juridical person wishing to be listed in the register of tax agents shall satisfy all of the following conditions:

  1. Be licensed as an audit, tax or law firm.

  2. Hold or be covered under a valid professional indemnity insurance that is appropriate to the nature and size of its business.

  3. At least one director or partner that meets all of the natural person requirements in Clause 1 of this Article, is supervising the services provided by the juridical person and does not work for another juridical person or for its benefit.

  4. Meet any additional conditions prescribed by the FTA.

[16] Article 13(4) of the New Executive Regulation states that the fees due in accordance with Clause 3 of this Article must be paid within (20) twenty business days from the date of notification of the approval. If the fees due are not paid within this period, the application shall be considered cancelled.

[17] Article 13(8) of the New Executive Regulation states that the listing in the register shall be for three (3) three years for natural person and (1) one year for a juridical person from the date of listing and the tax agent may apply to the FTA to renew the listing no later than (20) twenty business days before the expiration of its listing and shall pay the required fees by the date specified by the FTA.

[18] Article 13(9) of the New Executive Regulation states that any renewal request submitted after the elapse of the period set out in Clause 8 of this Article shall be treated as a new application and must meet the conditions set out in Article 12 of the New Executive Regulation.

[19] Article 13(10) of the New Executive Regulation states that, if the tax agent does not make an application to renew its listing before the expiration of the durations referred to in Clause 8 of this Article, its registration shall be cancelled and its link to all the persons it represents with the FTA shall be revoked, as of the expiration date of its listing in the register.

[20] Article 13(13) of the New Executive Regulation states the FTA shall de-list the tax agent from the register in any of the following cases:

  1. If the FTA has determined that the tax agent is unable to fulfil its duties or functions, or is no longer meeting the conditions specified in Article 12 of the New Executive Regulation.

  2. If the FTA has serious grounds to believe that the continued listing of the person as a tax agent would adversely affect the integrity of the tax system in the UAE.

  3. If the tax agent committed a serious violation of the provisions of the Decree-Law or the tax law or committed or participated in tax evasion.

  4. If the FTA found out that the tax agent is a current member of the Committee.

[21] Article 13(15) of the New Executive Regulation states that Clause 14 of this Article shall result in the tax agent being delinked from all persons it represents before the FTA, after (5) five business days from the date of notification of the FTA's decision.

[22] Article 14(1)(e) of the New Executive Regulation states that, in performing its duties, the tax agent shall keep information, documents, records and data in respect of any person represented by the tax agent.

[23] Article 16(1) of the New Executive Regulation states the FTA shall notify the person of a tax audit, at least (10) ten business days prior to the tax audit, and the notification shall set out the possible consequences of obstructing the tax auditor in the exercise of his duty.

[24] Article 23(2) of the New Executive Regulation states that prior to initiating a criminal case, the FTA may reconcile in tax crimes stipulated in Clause 4 of Article 25 of the Decree-Law, after the settlement of an amount of (50,000) fifty thousand Dirhams. If any of these crimes resulted in tax evasion or facilitated or concealed tax evasion, reconciliation shall be made by paying the amount set forth in Clause 1 of this Article.

[25] Article 24(1) of the New Executive Regulation states that a reconciliation application shall be submitted by the person to the FTA in the form prepared by the FTA for this purpose, before the initiation of a criminal case. The form must include the person's undertaking to settle the full amounts due from him as consideration for reconciliation.

[26] Article 24(2) of the New Executive Regulation states that the FTA decides to accept or reject the reconciliation application, if the FTA decides to accept the application, a record shall be issued to that effect containing proof of reconciliation and its consideration, and signed by both parties. A copy of such record shall be handed to the person after payment of the consideration for reconciliation.

[27] Article 24(3) of the New Executive Regulation states that a reconciliation application shall be submitted by the accused or convicted person, as the case may be, at any stage of the criminal case to the competent federal public prosecution.

[28] Article 24(5) of the New Executive Regulation states that the public prosecution shall issue record of reconciliation after the settlement of full tax and administrative penalties payable and the additional consideration for reconciliation. Such record shall be signed by both the competent public prosecution member and the accused or convicted person, and shall be approved by the federal attorney general. The record must include the following:

  1. The details of the accused or the convicted person.

  2. A description of the charges attributed to the accused or convicted person, the date and place of their occurrence and the articles of law applicable thereto.

  3. The value of the tax and administrative penalties payable.

  4. The percentage and value of the additional amount for reconciliation.

Evidence of settlement of the aforementioned amounts must be attached to the record. In the event that the administrative penalties are paid in instalments or waived in accordance with Article 50 of the Decree-Law, or if the payment of the additional consideration for reconciliation is deferred or paid in instalments in accordance with Clause 9 of this Article, a payment plan shall be attached to the record showing the deferred or installed payment, as applicable. The FTA and the competent court shall be notified of the approved reconciliation record, as applicable.

[29] Article 25(1) of the New Executive Regulation states the FTA may extend the deadline for deciding on a tax assessment review request and a request for reconsideration, which fulfil the formalities, for a period of (20) twenty business days if the extension is necessary to decide on the request.

[30] Article 25(2) of the New Executive Regulation states that the Committee may extend the deadline for deciding on a tax objection, which fulfils the formalities, for a period of (60) sixty business days if the extension is necessary to decide on the objection.

[31] Article 25(3) of the New Executive Regulation states that the FTA may, at the request of the persons concerned, extend the deadline for accepting the submission of a tax assessment review request or a reconsideration request, in the cases deemed appropriate by the FTA.

[32] Article 25(4) of the New Executive Regulation states that the Committee may, upon the request of the persons concerned, extend the deadline for accepting the submission a tax objection if there is a reason beyond their control, sudden accident, emergency circumstances or force majeure that prevented them from submitting the tax objection within the specified deadline.

[33] Article 27(3) of the New Executive Regulation states that the FTA shall notify the appointed bankruptcy trustee of the amount of the due tax and of its intention to perform a tax audit for specific tax period(s), within (20) twenty business days after being notified of the trustee's appointment under Clause 2 of this Article.

[34] Article 30(3) of the New Executive Regulation states that Decisions issued by the FTA and procedures applied by it for the implementation of the Cabinet Decision No. 36 of 2017 on the Executive Regulation of Federal Law No. 7 of 2017 on Tax Procedures and its amendments shall remain in force, insofar as they do not contradict with the provisions of the New Executive Regulation until the issuance of decisions and procedures replacing them in accordance with the provisions of the New Executive Regulation.

[35] Article 31 of the New Executive Regulation states that:

  1. The New Executive Regulation shall be published in the Official Gazette and shall come into effect as of 1 August 2023.

  2. As an exception to Clause 1 of this Article, Clause 2 of Article 12 of the New Executive Regulation shall come into effect as of 1 December 2023.