An Economic Substance Regulation appeal is an official request made by a licensee to repeal a decision made by the Regulatory Authority after the licensee’s noncompliance with ESR requirements. The process of appeal offers licensees a ground to present extra information, correct wrongly presented data, or dispute the imposed penalties. Therefore, licensees should seek the services of ESR Consultants in UAE to seamlessly prepare and submit an ESR appeal in compliance with the ESR Regulation.
Conditions to ESR appeal
To initiate an appeal, there must be valid grounds for challenging the regulatory authority’s decision. Common grounds for appeal may include procedural errors, misinterpretation of facts, or evidence of compliance that was not considered during the initial assessment.
How to apply for an appeal?
Below is a step-by-step procedure for applying for an Appeal:
1. Submission through the Ministry of Finance Portal
Firstly, go to the Ministry of Finance Portal, the designated platform for submitting appeal requests. You must confirm compliance with the portal’s technical requirements.
2. Search for Licensee’s Dashboard
Upon accessing the Licensee’s Dashboard, review the details of your ESR valuation and the imposed penalties.
3. Submitting an Appeal Request
At the Licensee’s Dashboard, find the option to submit an appeal request. Fill out the essential information correctly, ensuring that all obligatory fields are completed.
4. Providing Supporting Documents
To reinforce your appeal, you will need to provide secondary documents that validate your claims. These may include;
- Financial Records
- Transactional Data
- The business’s Trade License
- Legal Contracts
- Expert Opinions
5. Sending the Appeal Request
Cautiously review the provided information and attached documents before confirming your appeal request. Once done, submit the request through the Ministry of Finance Portal.
6. Confirmation and Notification
After submitting your appeal request, wait for confirmation from the regulatory authority regarding the approval of your appeal. Stay attentive to any notifications or requests for additional information that may be conversed through the portal or via email.
Providing Supporting Documents
When navigating through the Economic Substance Regulations appeal process, Licensees may be requested to furnish extra information or documentation. These requests are decisive for assessing the appeal and require prompt attention. Responding efficiently to such requests can expressively impact the outcome of the appeal.
Obligations and Timeline for Document Submission
Fulfilling the National Assessing Authority’s document submission requirements is vital to ensure an even appeal process. Licensees must fulfil their requirements by providing the requested supporting documents within a definite timeline. To meet the period for document submission, Licensees must follow these steps;
1. Prompt Action
Upon receiving a request to provide extra information or documentation, Licensees must promptly comply and provide the same.
2. Detailed Preparation
Licensees should prudently review the demanded documents, confirming accuracy, comprehensiveness, and compliance with relevant regulations.
3. Timely Submission
The National Assessing Authority usually sets a deadline for document submission. Licensees must submit the demanded documents within this timeframe to avoid possible penalties or delays in the appeal process.
4. Communication and Transparency
Licensees must keep open lines of communication with the National Assessing Authority, quickly addressing any concerns or inquiries related to the requested documents.
5. Confirmation of Receipt
After submitting the documents, Licensees should seek approval from the National Assessing Authority regarding the positive receipt of the materials.
By understanding and fulfilling their requirements, Licensees can navigate the document submission process efficiently and contribute to a fair and effectual resolution of their appeal.
What is the deadline for ESR Appeal?
Essentially, Licensees and Exempted Licensees should be aware of the exact timeframe for submitting an ESR appeal and settling the related ESR Penalty. The deadline for both processes is 40 working days, commencing from the date when the ESR penalty is imposed.
The Federal Tax Authority’s final decision
The respective Authority undertakes a detailed assessment within 40 working days and then notifies the Licensee and Exempted Licensee of their decision. The notification is posted within 5 working days from the date the decision is issued.
ESR Penalties in UAE
The Federal Tax Authority imposes various ESR Penalties in the UAE for non-compliance;
- Failure to file an ESR Notification within 6 months: a penalty of AED 20,000.
- Failure to submit ESR Reporting within 12 months: a penalty of AED 50,000.
- Non-compliance with Economic Substance Requirements: penalty of AED 50,000.
- Recurrent violation of National Assessment Authority’s identified violations: penalty of AED 400,000.
- Providing wrong information: penalty of AED 50,000. This penalty can be imposed within 12 months.
Seek the expert services of ESR Consultants in UAE
For licensees to seamlessly prepare and submit an ESR appeal in compliance with the ESR Regulation, licensees should seek the services of ESR Consultants in UAE. Therefore, consult us today and we shall be glad to assist you.