Your Monthly Tax Update for the GCC region
As the year 2025 draws to a close, many tax professionals in the Gulf are still busy with all the tax changes and compliance obligations this year has brought us. Especially in the UAE, there have been many tax changes, some of which taking effect from 1 January 2026. Some of these updates are included in the current Gulf Tax Insights, ensuring that you can start the new year well prepared. We hope you will find some time between finalizing work and the holidays, to read up on the following tax changes in this month's Gulf Tax Insights.
- The UAE has updated its Tax Procedures Law effective from 1 January 2026 to improve clarity, compliance, and consistency across all applicable taxes. These amendments introduce, among others, extended audit periods, stricter tax refund timelines, and binding directives from the Federal Tax Authority (FTA).
- Significant changes have been introduced in the UAE's tax penalty framework means of by Cabinet Decision No. 129 of 2025, effective 14 April 2026. The changes aim to simplify compliance and harmonize penalties across different tax types including VAT, Excise Tax, and Corporate Income Tax.
- The UAE has introduced significant amendments to its VAT Law effective from 1 January 2026, impacting multiple business sectors. These changes affect, among others, VAT invoicing, input VAT recovery, excess VAT credit management and VAT limitation periods. The VAT Law amendments require businesses to adapt their compliance and accounting practices accordingly.
- Finally, we round up recent tax treaty developments across GCC Member States.
We wish you happy holidays and a healthy and successful new year.
Please contact one of the editors or your usual DLA Piper advisers if you have any feedback or require further assistance.
