The UAE began implementing VAT on January 1
UAE's Federal Tax Authority calls on unregistered companies to comply with VAT to avoid fines
The UAE’s Federal Tax Authority on Sunday called on businesses who haven't registered for VAT to do so to avoid fines and legal proceedings.
The UAE began implementing 5 per cent VAT on January 1, but some businesses have failed to register for the levy.
Khalid Al Bustani, the director general of the FTA, said in August that an estimated 350,000 companies were subject to VAT and should register before December 4. Online registration for VAT began in September, but experts say many businesses have waited till the publication of the VAT executive regulations in November before they began the registration process.
“The Federal Tax Authority has urged business sectors to complete all their registration requirements for VAT purposes, commending the commitment and high turnout in the registration process,” the authority said in a statement. “The FTA confirmed that the registration process is continuing and other businesses that did not register to date should register immediately to avoid fines and legal proceedings.”
Businesses were advised to complete their registration formalities before December 4, as the authority requires, by law, 20 working days to access and process their applications, Mr Al Bustani said in November.
The UAE and other Arabian Gulf states are introducing taxes to shore up dwindling government income from oil. The UAE expects to generate Dh12 billion in Vat revenue in 2018 and Dh20bn in the second year of implementation, according to government officials.
“The FTA has urged natural and legal persons doing business in the UAE with taxable supplies and imports of goods and services that exceeded AED375,000 over the previous 12 months or coming 30 days to register for VAT,” the authority said.
“The Authority also stressed the importance of completing all registration requirements, and obtaining a tax registration number TRN as well as to carefully review it and ensure its flawlessness before submitting, as faulty data could lead to the rejection of the application.”