UAE Amended some Administrative Penalties for Violation of Tax Laws in the UAE

Cabinet Decision No. 49 of 2021 on Amending some Provisions of Cabinet Decision No. 40 of 2017 on the Administrative Penalties for Violation of Tax Laws in the UAE

In accordance with Cabinet Decision No 49 of 2021 on Amending some Provisions of Cabinet Decision No. 40 of 2017 on the Administrative Penalties for Violation of Tax Laws in the UAE, which will be effective from 28 June 2021, the FTA would like to inform you that it has released two Public Clarifications, which you can view on the FTA website.

With respect to TAXP002, and if you had any outstanding balances, you would have previously been able to see such outstanding balance on the returns page. From Wednesday 23 June, you will be able to see how much of your balance is related to tax and how much is related to administrative penalties on the My Payments page when you log into E-Services. This link will open a window that will include the following:

  • Tax Payable – this is the outstanding tax balance (based on tax returns you submitted and any adjustments due to voluntary disclosures or tax assessments) and will be updated on a daily basis until 31 December 2021, for you to know how much tax is outstanding and is subject to late payment penalties if not settled by payable date, and needs to be settled in full before 31 December 2021 to benefit from the redetermination of administrative penalties in accordance with Cabinet Decision No 49 of 2021.
  • Late Registration Penalty – this is the outstanding unpaid late registration penalty, if available.
  • Other Penalties Payable – this is the outstanding unpaid administrative penalties balance (other than late registration) and may increase if new administrative penalties are applied or decrease if payments are made or penalty reversed. The balance on 28 June 2021 will be subject to redetermination if conditions stated in Cabinet Decision No 49 of 2021 are met.
  • Net Payable Amount – this is the total amount of Tax Payable and Penalties Payable outstanding at any time.
  • Total Credit – this is the amount of credit that the registrant has with the FTA. FTA will be launching a full dashboard with your Tax Payable and Administrative Penalties

 

 

VAT registration of ‘Sole Establishments’ clarification VATP026 replaces Public Clarification VATP021.

VAT registration of ‘Sole Establishments’ clarification:-  VATP026 replaces Public Clarification VATP021.

A natural or legal person may own a number of sole  establishments. There has been uncertainty on whether each sole establishment needs to obtain a separate VAT registration or whether all such establishments should be included under one VAT registration.

This Public Clarification clarifies the VAT registration obligations of a person in respect of its sole establishments. Note that the term “person” refers to a natural or legal person.

A person owning a number of sole establishments should obtain only one VAT registration for all its sole establishments, and it is not permissible to register each sole establishment separately for VAT. The Federal Tax Authority (‘FTA’) will review, in certain cases, the VAT registrations by taxable persons in respect of sole establishments and will inform them of the corrective steps to be taken, if any.

For further clarification visit us at:- www.rbsauditing.com .

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The UAE’s Ministry of Economy has asked all companies in the country to submit authentic details of their beneficiaries before June 30, 2021 to avoid penalties

All UAE companies required to submit UBO details before 30th of June 2021

An initiative of the UAE government to combat against activities related to terrorist financing and money laundering, Cabinet Decision (No 58) of 2020 on Regulation of Procedures for Real Beneficiary requires all companies to maintain a register and submit relevant details of their Ultimate Beneficial Owners (UBO).

Ministry of Economy has set its deadline for submission of UBO details of all companies under its jurisdiction for the 30th of June 2021.

Fine & Penalties up to AED 100,000

All companies in UAE failing to submit UBO details on or before the deadline will be imposed with administrative sanctions face penalties of up to Dh100,000 from July 2021.

Importantly, the company’s licence can also be suspended for a year for not conforming to the instructions of the ministry.

Details to disclose with the authority are as follows:

  • Details of ownership
  • Details of all Ultimate Beneficial Owners
  • Company business model
  • Company financial records
  • General information including the details of the company from lawyers, banks, and auditors

A real beneficiary or UBO is the natural person controlling or owning at least twenty five (25) percent of the company’s issued share capital, either through direct or indirect control or chain of ownership. A UBO is also any natural person that has control on the dismissal and appointment of majority of company directors.