Federal Tax Authority (FTA)

Meaning & Definition

The Federal Tax Authority (FTA) is the government agency of the UAE that is responsible for the administration, collection, and enforcement of VAT and excise taxes. The FTA ensures compliance with all applicable tax laws by businesses and also helps promote transparency in the UAE’s tax system by monitoring employer obligations to withhold taxes from employees’ earnings.

Important aspects of the Federal Tax Authority (FTA)

• Responsible for tax-related compliance and enforcement throughout the UAE.
• Proper collection of VAT and other federal taxes.
• Guide businesses and employers through guidelines and regulations.
• Help companies keep their financial and taxation records correctly.
• Support organizations remove the risk of penalties through formalised compliance systems.
• Support tax transparency and accountability.

Compliance & Policy Considerations 

• This Law is not applicable in India.
• Federal Law No. 7 of 2017 was the Law on Tax Procedures. 
• It provides the basis for the implementation of Value Added Tax (VAT) and Excise Tax in the UAE. 
• All businesses must complete registration, report on returns, and adhere to the requirements of the Federal Tax Authority (FTA). 
• Employers are required to have relevant records and prepare tax documentation and returns where necessary.