Updating your details on the FTA portal to avoid AED 15,000 Penalty

keep up to date

AED 15,000 The failure of the Registrant to inform the Authority of any circumstance that requires the amendment of the information pertaining to his tax record kept by Authority

FTA in Dubai state that if you fail to inform them of changes in any circumstances you will incur a penalty of AED 5,000 initially and AED 15,000 for repeating it.

The main items that go out of date are as follows:

  • Trade License
  • Emirates ID
  • Possible Passport Copy

The above are basic items that should always be updated when they are renewed, however the problems arise when you are updating the items.

The FTA portal has been updated to make mandatory the need to include your bank account and power of authority, these items were not mandatory when many companies registered for their TRN number in 2017.

Also for some companies the FTA require them to provide a financial statement to confirm the sales and expense for the last 12 months. I would really urge business owners to consult a tax advisor when doing this as many companies are incorrectly registered for VAT and providing such financial statements could cause the FTA to request other information eventually leading to a penalty of either AED 10,000 for failing to deregister or AED 3000++ for submitting and incorrect return.

To be honest this is all it takes to keep your FTA portal up-to-date and in addition to the above the basics such as contact details can only be updated through an email to the FTA and not through the portal.

Ali Afzal is the Managing Director and VAT Consultant for Profits Plus Accountants registered as Profits Accounting and Bookkeeping a British Owner Managed Accounting Firm in Dubai. We manage over 100 clients vat submissions and cater for clients from around the World. We are registered with Xero Cloud Accounting as a Silver Tier Partner and our fees start from AED 850 per month. Contact me on [email protected] for more information.

4 Quick Facts About Registering for VAT in the UAE

Must Know Facts About VAT in the UAE

Registering for VAT in Dubai should not be taken lightly and certainly not considered part of the process of operating in Dubai, you only need to register if you qualify or if you exceed a threshold. Failing to adhere to the Federal Tax Authorities in Dubai is a serious offence and can incur heavy penalties. Below are 7 facts that you must understand before registering for VAT in Dubai.

1. Individual Responsibility
When you register for VAT you are registering the person that is operating a business, not the business itself. Ultimately it is the individual who will be responsible the vat and the responsibilities that come with registering for VAT with the FTA. This responsibility must not be taken lightly and it is ultimately connected back to your Emirates ID.

A person can only hold one TRN for VAT purposes at any one time. It is your responsibility to ensure that duplicate applications are not submitted.

2. When do I need to register for VAT?
There is no need to register for VAT with the FTA when starting your trade license. There is so much incorrect advice on this matter. The principles requirements of VAT are fixed and therefore it is not a choice to register when setting up a company.

Mandatory Registration – if you meet the following criteria then you must register immediately:
• Your turnover was more than AED 375,000 in the last 12 months; or
• You expect that your turnover will be more than AED 375,000 in the next 30 days.

Voluntary Registration – if you meet the following criteria then it is your choice however your next 12 months will play an important factor on whether you should register voluntarily or not:
• Either your turnover or expenses (which will be subject to VAT) were more than AED 187,500 in the last 12 months; or
• You expect that either your turnover or expenses (which will be subject to VAT) will be more than AED 187,500 in the next 30 days.

3. Applying for exemption from VAT
If you have a trade license in the UAE (LLC or Freezone) and do not operate in Dubai and receive all income from outside UAE then you may qualify for exemption from VAT but you still MUST apply for this through the FTA. Banks will request this and may hold payments as a result. This is also known as zero-rated supplies.

4. Branches are not separate legal entities
Only the entity of which they are branches should apply for registration where that entity meets the relevant criteria. Even if you are operating via branches in more than one Emirate, only one VAT registration is required.