What Is the UAE Five-Year Tax Credit Limit? Understanding Federal Decree-Law No. 17 of 2025

The UAE has introduced significant changes to its tax framework through Federal Decree-Law No. 17 of 2025 , which amends certain provisions of the Tax Procedures Law. Effective from 1 January 2026 , the new legislation introduces a strict five-year limitation period for claiming tax credit refunds or utilizing tax credit balances against outstanding tax liabilities.

This development affects all federal taxes administered by the Federal Tax Authority (FTA) , including Value Added Tax (VAT), Corporate Tax , and Excise Tax . Businesses that fail to monitor and recover eligible tax credits within the prescribed timeframe may permanently lose their entitlement.

For UAE businesses, this amendment represents one of the most important tax compliance changes in recent years and requires immediate attention.