Is tax evasion a predicate offence under the UAE’s new AML Law?
Yes. Under Federal Decree-Law No. 10 of 2025, the scope of a predicate offence was widened to expressly capture both direct and indirect tax evasion, alongside terrorist financing and proliferation financing. Proceeds generated from evading tax can therefore form the basis of a money laundering charge in the UAE, closing a gap that existed under the previous 2018 law.
For regulated businesses, the practical effect is that customer and transaction risk assessments must now treat tax related red flags as potential money laundering indicators. A client structuring payments to disguise taxable income, or moving funds to obscure their true tax position, may trigger a reporting obligation even where the underlying tax offence took place abroad, subject to dual criminality.
Compliance teams should review their typologies, transaction monitoring rules and enhanced due diligence triggers to make sure tax evasion scenarios are covered. Any suspicion of tax driven laundering must be reported to the Financial Intelligence Unit without delay.
Legal Reference (UAE):
· Federal Decree-Law No. 10 of 2025, Article 2 sets out the money laundering offence built on proceeds of a predicate offence, which now expressly includes direct and indirect tax evasion
For more details, consult the full text of Federal Decree-Law No. 10 of 2025 or seek guidance from your AML compliance officer.