Navigating Tax Disputes: Your Guide to the Tax Dispute Resolution Committee (TDRC) in UAE

Tax disputes between taxpayers and the Federal Tax Authority (FTA) can arise due to various reasons, leading to disagreements that require resolution. The Tax Dispute Resolution Committee (TDRC) serves as a pivotal entity in the UAE's tax landscape, offering a fair and impartial platform for resolving such disputes when the reconsideration process fails. This article delves into the essential aspects of TDRC, including submission conditions, jurisdiction, and the procedure to raise objections.

1. 1. Submission Conditions for Objections to TDRC:
   • 1.1 Timely Submission: Taxpayers must initiate the objection process within 40 business days of receiving the FTA's decision on reconsideration request.
   • 1.2 Settled Tax and Penalties: Prior to approaching TDRC, the disputed tax must be settled.
   • 1.3 Reconsideration Request to FTA: It's imperative to note that a reconsideration request must first be submitted to the FTA before approaching TDRC directly.

1. 2. Jurisdiction of TDRC:
   • 2.1 Objections on FTA's Decisions: TDRC can adjudicate objections arising from the FTA's decisions on applications for reconsideration. An application for a reconsideration request should give details of the reasons why the taxpayer believes the decision should be reconsidered, supported by legislative references and any relevant FTA publications
   • 2.2 Unresolved Reconsideration Cases: TDRC holds authority over applications for reconsideration that were submitted to the FTA but remain unresolved.
   • 2.3 Monetary Limit: When the total Due Tax and Administrative Penalties do not surpass AED 100,000 as per legal provisions, TDRC's decision on the objection is considered final.

1. 3. Determining Relevant TDRC Jurisdiction:

   TDRC's jurisdiction is determined based on the taxpayer's registered address with the FTA:

   • 3.1 Dubai TDRC: Cases from Dubai Emirate.
   • 3.2 Abu Dhabi TDRC: Cases from Abu Dhabi Emirate and non-residents.
   • 3.3 Sharjah TDRC: Cases from all other Emirates.

   Note: In the case of a Tax Group, the relevant TDRC is determined by the address of the representative member.

1. 4. Procedure to Submit an Objection to TDRC:
   • 4.1 Download and Fill Form: Obtain the objection form from the Ministry of Justice website and complete it in Arabic, providing comprehensive applicant, legal representative, and FTA decision details.
   • 4.2 Attach Essential Documents: Include crucial documents, such as legal representative information, an explanatory memorandum of objection, FTA's decision, and the payment receipt for the disputed tax or fines.
   • 4.3 Submission via Email: Send the completed form and attachments in PDF format to [email protected].
   • 4.4 Committee Review: The committee secretary will receive objections, consult with Committee members, and schedule a session for consideration.
   • 4.5 Notification of Decision: The Committee's secretary will inform both the Authority and the objector about the session date and ensuing decisions.

1. 5. Timelines for TDRC Decision:

   TDRC will communicate its decision within a maximum of 45 business days, which could be extended to 65 business days if required.

Takeaways:

• The importance of evidence in the reconsideration procedure cannot be overstated. Taxpayers must ensure that all necessary documentation is included in the reconsideration request to establish compliance with the law
• Understanding the specific nature of the dispute and aligning legal arguments accordingly is essential. The scope of the dispute must be confined to the original issues, and overreaching must be avoided. In contrast, before a reconsideration request is filed, the taxpayer must ensure that the underlying decision obtained from the FTA encompasses all the items the taxpayer wishes to dispute.

Conclusion: The Tax Dispute Resolution Committee (TDRC) is a crucial institution in the UAE's tax framework, providing a transparent and equitable platform for resolving tax-related disagreements between taxpayers and the Federal Tax Authority. Adhering to the defined submission conditions, understanding TDRC's jurisdiction, and following the structured objection procedure can help taxpayers effectively navigate the dispute resolution process. In complex matters of UAE VAT laws and indirect taxation, professional assistance, such as that offered by MBG, can ensure compliance and tailored solutions for your organization's specific needs. Top of Form.

In case you require any assistance in obtaining a Tax Dispute Resolution Committee (TDRC), please contact [email protected]

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