VAT Registration : Natural Persons – Impact of UAE VAT On Individuals

 



VAT Registration Natural Person and VAT compliance :

One of the most common questions most of the Natural Persons who owns multiple businesses have when it comes to registering with Federal Tax Authority (FTA) for a VAT Tax Registration Number (TRN) is whether to:

  • Request for a separate TRN no. for each business owned by them or 
  • Seek one TRN no. for all businesses owned by them

FTA recently published a Clarification (VATP021) on the subject to help Natural Person comply with VAT law and regulations. Some of the important points to consider from the Clarification include:

Who should register for VAT – Natural Person or his Sole Establishments separately:

A Natural Person owning a number of sole establishments needs to obtain only one VAT registration for all its sole establishments and does not require separate VAT registrations for such establishments.

FTA further noted, the Clarification does not apply to a One-Person Company  LLC or other similar legal entities, which are seen as distinct and separate legal persons from their owners.

VAT tax registration threshold:

Taxable supplies bya natural person, as well as his sole establishment, must be considered collectively in order to determine the VAT registration obligations.  

Action based on the Clarification:

Future VAT tax Registrations

Natural Person who owns one or more sole establishments, the value of supplies made by the natural person and all its sole establishments must be aggregated to assess whether the VAT registration threshold has been exceeded

(see our recent blog on VAT registration)

Existing VAT Registrations

VAT registrations received in the past, no action is required to amend the VAT tax registrations, until specifically directed by the FTA.

Disclaimer 

The article covers points which we consider are important in nature.  The article doesn’t capture all the elements covered by the FTA Public Clarification.  We request user to read the full article (VAT registration of ‘Sole Establishments’) before making a final decision.

Accountant’s Box is a UAE based accounting and VAT advisory firm.  We can assist you in registering your company for VAT in the UAE.  Our dedicated team will provide all necessary guidance on VAT registration. For information, you could reach us at info@accountantsbox.com.


Location: Dubai - United Arab Emirates

Comments

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