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VAT Registration of Sole Establishment in UAE

A person having different business establishments can follow the provisions of sole establishments under UAE VAT law to optimize their time and efforts in completing the tax-related functions. Federal Tax Authority has published specific guidance with respect to sole establishments which is further discussed in detail below.

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VAT Registration of Sole Establishment in UAE

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  1. VAT Registration of Sole Establishment in UAE

  2. A person having different business establishments can follow the provisions of sole establishments under UAE VAT law to optimize their time and efforts in completing the tax-related functions. Federal Tax Authority has published specific guidance with respect to sole establishments which is further discussed in detailbelow.

  3. Sole Establishment under UAE VAT law

  4. A sole establishment is explained in other words as a sole proprietorship that is 100% owned by a natural person. The type of ownership legally allowed for business and the sole establishment does not carry another legal identity different from its owner.A natural person can own more than one sole establishment and all the sole establishments under a natural person put together will be considered as the same as the natural person when tax formalities areconsidered.

  5. Is VAT registration mandatory for soleestablishments? The requirement forVAT registration in Dubai depends upon the volume of taxable supplies and FTA has specified threshold limitsfor both mandatory and voluntary tax registrations. Any natural person owning sole establishments are liable to assess the volume ofhis/her taxable supplies, considering all the establishments together, to compare with the registration thresholds. Once the aggregated amount of taxable supplies of all the sole establishments exceeds or is expected to exceed the mandatory registration threshold which is AED 375,000 per annum, VAT registration should beobtained.

  6. Is it Mandatory for each of the sole establishmentsto register for VATseparately? A natural person owning multiple sole establishments required to obtain only one VAT registration on the behalf of all his establishments. Hence separate registration is not required for each of the soleestablishments.

  7. IsVAT return filingin Dubaimandatory forsole establishments? All Entities under VAT-registered include registered natural persons who have sole establishments should file the periodic VAT returns withFTA. Whether to file the VAT return monthly or quarterly willbe as notified by Federal Tax Authority, once registered. A registered person can filled VAT returns using the e-portal service facilitated by FTA. For further clarifications regarding the filingof VAT returns, feel free to contact Parsh.

  8. Hope you have a clear idea of the implications of VAT registration for UAE sole establishments. Still, you have queries regarding VAT registration of sole establishment in Dubai? Contact Parsh, we are happy to discuss with you the recent developments in the context of tax rules and provide you with insights on implementing the best practices in theregion. Parsh Accounting andBookkeeping

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