What Are the New Tax Rule Changes to Be Kept in Mind by Businesses in the UAE in 2026?
The UAE authorities continue to strengthen the tax system by introducing strategies, policies, and procedural updates aimed at improving transparency and fairness for both the public and taxable entities. As part of these efforts, several important updates to tax procedures and regulations have been announced to provide greater clarity and consistency in tax compliance.
The latest changes focus on simplifying refund processes, defining clear timelines, ensuring consistent application of tax rules, and clearly outlining key deadlines that taxable entities must follow. These updates are designed to help businesses better understand their obligations while allowing them to benefit from available tax provisions in a timely manner.
The revised tax procedures will come into effect from 1 January 2026.
Which are 5 Major Updates Regarding the Tax Procedures in 2026?
The changes that would be implemented are classified into 5 major updates, which are explained below. The businesses and the taxable entities must be aware of these updates before they step into the new year of 2026.
Clear and Defined Refund Rules and Procedures
Under the newly issued law, taxable entities are allowed to claim tax refunds within a maximum period of five years from the date the tax credit balance arises. Alternatively, the available tax credit may also be used to offset outstanding tax liabilities. These provisions enable businesses to manage tax credits more effectively by offering clear timelines, improved predictability, and greater flexibility, particularly in cases where credit processing or adjustments are delayed.
Tax Audits
Under the updated provisions, taxable entities may be subject to more rigorous tax audits, as the Federal Tax Authority (FTA) is now authorized to conduct tax audits even after the expiration of the standard limitation period. As a result, businesses are expected to maintain proper records and remain prepared for audits at all times.
These measures strengthen regulatory oversight by helping prevent non-compliance and safeguarding public finances, while also encouraging businesses to adopt stronger internal controls and accurate tax reporting practices.
Continuous Tax Guidance
The Federal Tax Authority (FTA) will continue to provide clear instructions and guidance to taxable entities and the public, as and when required. This includes issuing official directions, procedures, and clarifications to support accurate and timely tax compliance.
Such continuous guidance helps ensure a uniform understanding of tax laws and regulations, reducing compliance risks and promoting consistent application of tax procedures across all relevant sectors.
Transitional Relief for Taxable Entities
Taxable entities whose five-year refund claim period has already expired, or is due to expire by 1 January 2026, may apply for a one-year extension. This transitional relief allows eligible businesses an additional opportunity to submit refund claims for outstanding tax credits.
The extension supports fair treatment for entities affected by delays and offers greater financial certainty, enabling businesses to plan and manage their tax positions more effectively.
Why Are These Amendments Required?
According to the authorities, these amendments are intended to ensure that tax laws and procedures serve the best interests of taxpayers and the wider public while enhancing transparency across the tax system. The updates are designed to keep the UAE’s tax framework aligned with evolving global economic and regulatory standards.
Overall, the changes aim to reduce administrative burdens, strengthen public confidence, support competitive markets, and further position the UAE’s tax system in line with international best practices.
Embrace the Changes in Tax Rules with Taxoryx
Taxoryx provides expert support to help taxpayers understand and adapt to the latest tax rules and regulatory updates in the UAE. With a dedicated team of certified tax professionals, Taxoryx assists businesses in staying informed about new amendments, ensuring timely compliance, and maintaining a strong internal tax framework.
By working with Taxoryx, taxable entities can gain clear insights into updated regulations and implement effective compliance strategies aligned with current tax requirements.
To learn more about the recent amendments and updated tax rules, connect with Taxoryx today.
