Corporate Tax

Corporate Tax Audits by the FTA in the UAE

2025-12-05 · 4 min read · By Aureus Worldwide

A Corporate Tax audit is not an accusation, it is the FTA verifying that what you filed matches your records. Businesses that keep good documentation and understand the process treat an audit as a routine review; those that do not can find a manageable query escalating into assessments and penalties. Preparation, not panic, is the right response.

Why the FTA reviews returns

The Federal Tax Authority (FTA) administers Corporate Tax under Federal Decree-Law No. 47, and part of that role is checking that returns are accurate. An audit allows the FTA to verify that income, deductions and reliefs have been correctly reported and that the tax paid is right. Reviews may be prompted by various factors, and the FTA can request information and examine records. The point to internalise is simple: your return is a statement that must be supportable, and an audit is where that support is tested.

An audit tests whether your filed numbers can be traced to your records. If every figure on the return links back to documented support, an audit is a retrieval exercise. If it cannot, the audit becomes a problem.

What the FTA typically examines

While each review differs, the documents that commonly come under scrutiny include:

The reconciliation from accounting profit to taxable income is central. The FTA wants to see how you moved from net accounting profit to the taxable figure, with each adjustment supported. Our Corporate Tax record-keeping guide explains what to retain to make this straightforward.

The records that decide the outcome

An audit is won or lost on documentation. The records that matter most are:

1. Financial statements prepared on a sound accounting basis.
2. The computation and its workings, showing every adjustment.
3. Supporting documents for deductions, invoices, contracts, evidence.
4. Evidence of relief conditions being met, for any relief claimed.
5. Transfer pricing documentation where related-party transactions exist.

Records must be retained for the statutory period and be readily retrievable. A genuine deduction you cannot evidence is, in an audit, a deduction at risk, so the quality and organisation of your records directly shapes the result.

How to prepare before an audit ever happens

The best audit preparation is done continuously, long before any review:

• File supportable returns, never claim what you cannot evidence.
• Keep the reconciliation from accounting profit to taxable income for each year.
• Document relief conditions at the time you claim them, not later.
• Maintain transfer pricing documentation where required.
• Organise records by period so any year can be reconstructed quickly.
• Retain everything for the statutory period.

A business that does these things routinely can respond to an FTA request calmly and completely, which itself sets a constructive tone for the review.

Responding to an audit

If the FTA opens a review, the practical priorities are to respond promptly, accurately and completely. Provide what is requested, within the timeframes given; do not volunteer confusion or guesswork; and keep communication professional and factual. Where a question touches a complex position, a considered, well-evidenced explanation is far more persuasive than a hurried one. Meeting deadlines is critical, because missing them can worsen the position.

Assessments, penalties and your rights

If the FTA concludes that the tax was understated, it may issue an assessment adjusting the tax and apply penalties. Importantly, this is not the end of the road: taxpayers generally have rights to respond and to request reconsideration within set deadlines. A well-evidenced challenge, or a prompt correction where the FTA is right, is the constructive path. Our Corporate Tax penalties guide covers the penalty framework, and acting within deadlines is essential to preserving your options. Confirm the current procedures and timeframes with the FTA.

Common audit pitfalls

• Filing positions that cannot be evidenced
• No clear reconciliation from accounting profit to taxable income
• Claiming reliefs without documenting the conditions
• Missing transfer pricing documentation
• Disorganised records that cannot reconstruct a year
• Missing response or reconsideration deadlines

How Aureus Worldwide helps

Aureus Worldwide helps UAE businesses prepare for and manage FTA Corporate Tax audits. Our tax team ensures returns are supportable, maintains the reconciliation and relief documentation, manages FTA requests within deadlines, and prepares well-evidenced responses or reconsideration requests where needed. Our accounting team keeps audit-ready records, and our audit team supports the underlying financial statements. To make your Corporate Tax audit-ready, contact our advisors.

Talk to our chartered accountants →