VAT Registration of Sole Establishment in UAE

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VAT Registration of Sole Establishment in UAE
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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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Sole Establishment under UAE VAT law
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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 are
considered.
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Is VAT registration mandatory for sole
establishments? The requirement for VAT
registration in Dubai depends upon the volume of
taxable supplies and FTA has specified threshold
limits for both mandatory and voluntary tax
registrations. Any natural person owning sole
establishments are liable to assess the volume of
his/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 be
obtained.
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Is it Mandatory for each of the sole
establishments to
register for VAT separately? 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
sole establishments.
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Is V AT return filing in Dubai mandatory for sole
establishments? All Entities under
VAT-registered include registered natural
persons who have sole establishments should file
the periodic VAT returns with FTA. Whether to
file the VAT return monthly or quarterly will be
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
filing of VAT returns, feel free to contact
Parsh.
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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 the region.
Parsh Accounting and Bookkeeping