FTA extends deadline to File & Pay VAT Returns

Federal Tax Authority Issues a Directive on an Exceptional Basis for an Alternative Deadline to File Tax Returns for VAT and Pay Due Taxes on May 28, 2020, for the Tax Periods Ended on March 31, 2020

Extract from https://tax.gov.ae/en/press-releases/Federal-Tax-Authority-Issues-a-Directive-on-an-Exceptional-Basis-for-an-Alternative

  • The directive seeks to enable registrants to meet their tax obligations amid the precautionary procedures enacted to limit the spread of the novel Coronavirus imposing 24-hour restrictions on the movement of individuals and vehicles in certain areas of the UAE, which coincided with the deadline for filing VAT Returns. 
  • The Authority’s remote electronic services allow registrants to complete their registration, file Tax Returns, and settle due taxes from anywhere, 24 hours a day.

Abu Dhabi, April 21, 2020 – In light of its commitment to supporting VAT registrants and the unprecedented intensive precautionary measures undertaken by the UAE to curb the spread of the novel Coronavirus (COVID-19) imposing 24-hour restrictions on the movement of individuals and vehicles implemented in certain areas of the UAE, which coincided with deadlines for filing VAT Returns, the Federal Tax Authority (FTA) issued a directive on an exceptional basis providing an alternative date of 28 May 2020 for the deadline of submitting VAT returns and the payment of due tax for the Tax Period ended 31 March 2020, enabling Taxable Persons to meet their tax obligations without facing any difficulties.

In a press statement issued today, the FTA confirmed that, as per the directive, VAT registrants who have monthly tax periods must submit their returns, and settle the payable tax for the tax period from 1 to 31 March, 2020, no later than Thursday, 28 May 2020.

Meanwhile, VAT registrants having quarterly tax periods must submit their returns and settle the payable tax for the tax period from 1 January to 31 March, 2020, by Thursday, 28 May 2020.

The FTA urged VAT registrants to ensure the data they include in their VAT returns is accurate, and to also ensure that the FTA receives the payable tax for the tax period ending 31 March 2020, by Thursday, 28 May 2020, calling on all registrants to continue to abide by all other tax obligations as usual.

This exceptional directive for the deadline pertains only to VAT Returns for the tax periods that ended on 31 March 2020, and does not affect any other tax periods where the deadline for filing tax returns and settling of payable taxes does not fall in April 2020.

 The FTA provides the entirety of its services remotely, relying on a fully automated electronic system that facilitates registration, filing tax returns, and payment of due taxes from anywhere and over the course of 24 hours a day. The objective is to encourage registrants to comply with tax procedures, using the FTA’s online platform while avoiding direct physical interaction with relevant departments or the use of paper documents. This, in turn, adheres to the precautionary measures set by the UAE and aligns with the precautionary measures taken by the UAE regarding remote working.

Courtesy : https://tax.gov.ae/en/press-releases/Federal-Tax-Authority-Issues-a-Directive-on-an-Exceptional-Basis-for-an-Alternative

 

UAE’s Federal Tax Authority simplifies VAT recovery on new-build homes

FTA launches a new platform to further streamline the process of recovering VAT incurred by UAE citizens on the building of new homes

The Federal Tax Authority (FTA) has launched a new platform to further streamline the process of recovering value added tax (VAT) incurred by UAE citizens on the building of new homes.

Citizens who qualify for VAT recovery on new-build homes will receive an email with a request to submit the necessary documents to complete the processing, the FTA said in a statement.

FTA statistics reveal that the total number of requests submitted by UAE citizens to recover VAT on the construction of their new homes has reached 1,474, allowing citizens to recover AED84.07 million.

This marks a significant increase from the previous year, when the FTA received 539 applications claiming AED23.74 million that were approved by end of June 2019.

After verification of the documents, the citizen is notified of their entitlement. If the refund amount matches the tax invoices provided, then, following final approval, the refund amount is transferred to the applicant’s bank account.

The move follows a series of consultation meetings with UAE citizens seeking to recover VAT incurred on building new homes, as well as tax agents.

It added that the number of original documents that need to be submitted with the application has been reduced to just four, citing contractor/consultant authorisation and passport as examples of documents no longer required for the process while the application form itself has also been simplified.

The four documents that now need to be submitted with the application are a copy of the applicant’s family book, a copy of the applicant’s Emirates ID, a building permit included in the certificate of completion issued by the Municipality, and a document indicating the date from which the building has been occupied.

Khalid Ali Al Bustani, FTA director general, said: “Launching the online platform to recover VAT on the construction of new homes for UAE citizens is part of the authority’s strategy to provide best-in-class services and continuously revise executive procedures for tax legislation to ensure efficient performance, facilitate procedures, and achieve customer satisfaction among citizens, residents, and visitors.”

Courtesy : arabianbusiness.com

https://www.arabianbusiness.com/banking-finance/438239-uaes-federal-tax-authority-simplifies-vat-recovery-on-new-build-homes

Dubai to allow unified licensing for free zones

Dubai’s ‘one free zone passport’ allows businesses to operate without multiple licensing

Dubai: Businesses can operate out of multiple free zones in Dubai through a single license under the “one free zone passport” scheme.

What this does is bring out significant cost savings in licensing fees for those businesses wanting to have a base in more than one free zone in the emirate. Meanwhile, there is also a proposal to allow free zone licenses entities to take up rental contracts from the current 25 years to 50 years.

The DFZ Council is also “developing a comprehensive geo-economic map of Dubai that seeks to position the emirate as a leading destination for investment and business set-up”.

“Greater coordination paves the way for sustainable development and presents exceptional opportunities to attract SMEs and international companies and empower entrepreneurs to realise their creative ideas,” said Sheikh Ahmed Bin Saeed Al Maktoum, Chairman of DFZ Council.

This ties in closely with another recent Dubai-wide initiative, whereby free zone based entities could operate freely in “onshore” Dubai as well as offshore. This again did away with multiple licensing requirements for such businesses.

Financial marketplace

The DFZ Council is also lending its weight to the “Free Zone 10X” platform, which would create a financial market exclusively for free zone enterprises to tap funding through IPO listings. A study is being held on the feasibility of such a marketplace, and is now researching the “legislative and logistical requirements for implementing” it.

“The coordinated efforts among the free zones in Dubai contribute to economic diversification — an essential pillar of the economy of the future,” said Sheikh Ahmed. “This creates a favourable environment to bring groundbreaking concepts to life.”

Updating rental agreements

In what could be a path-breaking move, the Council also discussed a draft law proposal to systemise rental agreements within Dubai free zones. If passed, this will be done in conjunction with Dubai Land Department and the various free zone enterprises.

The proposal aims at “providing a larger pool of real estate options for companies”. If passed, it would extend lease terms for free zone businesses from 25 years to 50.

Wide representation

The team working on updating the free zone concept in Dubai includes representatives of the Ministry of Economy, the Department of Economic Development, Dubai Chamber of Commerce and Industry, Dubai Development Authority, Jebel Ali Free Zone, the Dubai International Financial Centre, Dubai Customs, and Dubai Municipality.

“The initiatives of the DFZ Council, such as the geo-economic map, bring added value to the local economy,” said Sheikh Ahmed. “Developments on the economic front transcend geographical borders and support the implementation of innovative projects in line with the priorities articulated in the recent “Letter of the New Season” from His Highness Sheikh Mohammed Bin Rashid Al Maktoum, Vice-President and Prime Minister of the UAE and Ruler of Dubai.”

https://gulfnews.com/business/dubai-to-allow-unified-licensing-for-free-zones-1.67307087

Excise Tax in UAE

All about Excise Tax in UAE

According to Cabinet Decision No. 52 of 2019 on Excise Goods

What is excise tax?

Excise tax was introduced across the UAE in 2017. Excise tax is a form of indirect tax levied on specific goods which are typically harmful to human health or the environment. These goods are referred to as “excise goods”.

When considering whether a product is an excise good, the following definitions apply:

  • Carbonated drinks include any aerated beverage except for unflavoured aerated water. Also considered to be carbonated drinks are any concentrations, powder, gel, or extracts intended to be made into an aerated beverage.
  • Energy drinks include any beverages which are marketed, or sold as an energy drink, and containing stimulant substances that provide mental and physical stimulation, which includes without limitation: caffeine, taurine, ginseng and guarana. This also includes any substance that has an identical or similar effect as the aforementioned substances. Also considered to be energy drinks are any concentrations, powder, gel or extracts intended to be made into an energy enhancing drink.
  • Tobacco and tobacco products include all items listed within Schedule 24 of the GCC Common Customs Tariff.

 Rate of excise tax

The rates of excise tax in the UAE will be:

  • 50 per cent for carbonated drinks
  • 100 per cent for tobacco products
  • 100 per cent for energy drinks.

for more info on this topic, Visit the link below :

https://government.ae/en/information-and-services/finance-and-investment/taxation/excise-tax

VAT Refund from FTA

Federal Tax Authority Reaffirms: ‘Refunding Tax for Eligible Applicants a Direct Transaction Between Registrants and the FTA’

Federal Tax Authority Reaffirms: ‘Refunding Tax for Eligible Applicants a Direct Transaction Between Registrants and the FTA’

  • The Authority reiterated its call for maintaining strict confidentiality of registrants’ data.

Abu Dhabi, September 10, 2019 – The Federal Tax Authority (FTA) reaffirmed that refunding taxes for legally eligible applicants is a direct transaction between the registered business and the FTA, and does not call for any intermediaries.

The process is completed via advanced electronic systems, available on the FTA’s official website, which boasts impressive security features for financial transactions. It is done through official channels using the International Bank Account Number (IBAN), and via systems under the authority of – and electronically linked to – the UAE Central Bank.

In a press statement issued today, the Authority noted that all of these official systems involve dealing directly with the FTA using Tax Registration Numbers (TRNs). They stand out for their accuracy, confidentiality, and data security, in addition to being inaccessible via email or any other medium that may be prone to piracy and hacking.

The Authority issued the above statement in response to reports that certain bank customers received emails from unidentified sources impersonating banks and financial institutions, and asking recipients to provide personal data, including names, credit card numbers, and PIN codes, claiming that providing the information will allow them to recover Value Added Tax.

The FTA reiterated its warning to all registered businesses, calling on them to remain vigilant and maintain the confidentiality of their personal data. The Authority reaffirmed that all transactions – registration, submitting Tax Returns, refunding tax for eligible candidates, etc. – can be completed with a few simple steps via the e-Services portal, available 24/7 on the FTA website: www.tax.gov.ae, which was designed in accordance with international best practices to make it easier for Taxable Persons to meet their obligations.

Original Source of information , click below :

https://tax.gov.ae/press-releases/Federal-Tax-Authority-Reaffirms-Refunding-Tax-for-Eligible

 

 

Federal Tax Authority Implements Penalties on Violators of the ‘Marking Tobacco and Tobacco Products Scheme

Federal Tax Authority Implements Penalties on Violators of the ‘Marking Tobacco and Tobacco Products Scheme

Information Source : https://www.tax.gov.ae/en/press-releases/Federal-Tax-Authority-Implements-Penalties

 

  • objective of the fines is to protect consumers against low-quality products that harm their health and the environment.

 

Abu Dhabi, May 25, 2019 – The Federal Tax Authority “FTA” will begin implementing the Cabinet Decision regarding violations of the “Marking Tobacco and Tobacco Products Scheme”, which calls for applying Digital Tax Stamps on the packaging of said products before supplying them to local markets.

The Authority stressed that the penalties are meant to curb attempts at commercial fraud, and protect consumers from contraband, low-quality products, that do not conform with standards and harm their health and the environment. The FTA explained that mechanisms have been set to implement the new legislation, which clearly outlines the commitments of both the taxpayers and the Authority, and sets mechanisms to tighten controls in UAE markets and ensure governance and transparency.

The Federal Tax Authority clarified that penalties have been set for nine types of violations of the Digital Tax Stamp Scheme, in an effort to protect consumers, prevent contraband, low-quality products from entering local markets, and halt sales of smuggled goods in the UAE.

According to the penalties chart enclosed in the Decision, a person who possesses or handles Designated Excise Goods that do not carry a Mark (Digital Tax Stamp) incurs a penalty of AED50,000 and 50% of the Excise Tax due on the designated Excise Goods. If a person knowingly allows his premises to be used for the sale of unmarked Designated Excise Goods in the UAE, that person shall incur a penalty of AED25,000 for the first violation and AED50,000 in case of repetition.

If a person alters or prints over Digital Tax Stamps affixed to Designated Excise Goods, they would be subject to a penalty of AED50,000 and 50% of the Excise Tax due. Meanwhile, if a person fails to report the movement of Designated Excise Goods, they will incur a penalty of AED20,000 for each time the violation was committed. In the event where a person fails to comply with the requirements to securely store the Digital Tax Stamps as determined by the Authority, a fine of AED50,000 per incident would be applicable.

In case a person fails to comply with time limits for returning unused Marks to the Authority, the penalty is AED50,000 per incident, whereas failure to affix Digital Tax Stamps to Designated Excise Goods in the manner and location specified by the Authority exposes the person in question to an administrative penalty of AED25,000 for the first violation and AED50,000 in case of repetition.

Furthermore, the penalties’ chart indicates that if a person conducts unauthorised trading, swapping, selling, or otherwise supplying of Digital Tax Stamps, they incur fines of AED25,000 for the first violation and AED50,000 in case of repetition, in addition to 50% of the amount collected as tax. If a person re-uses Marks that had previously been used on a Designated Excise Good, they would be subject to a penalty of AED50,000 and 50% of the Excise Tax due.

As of May 1, 2019, the import of any type of cigarettes into the UAE not bearing the Digital Tax Stamps has been prohibited; meanwhile, the sale across UAE markets, or importation or production of all types of cigarettes not bearing Marks will be prohibited as of August 2019. This is part of the timeline for the “Marking Tobacco and Tobacco Products Scheme”, which went into effect on January 1, 2019, and allows for electronically tracking cigarette packs from production and until they reach the end consumers, to ensure full compliance with Excise Tax obligations.

The Federal Tax Authority asserted that the Scheme will be gradually expanded to cover all tobacco products and support the Authority’s efforts to collect taxes, combat commercial fraud, and protect consumers against low-quality, contraband products that harm their health and the environment. The Scheme also facilitates inspection and control at customs ports and markets to halt sales of contraband products.

UAE Cabinet approves VAT revenues distribution between federal and local governments

UAE Cabinet approves VAT revenues distribution between federal and local governments

UAE Cabinet approves VAT revenues distribution between federal and local governments

Published Friday, May 31, 2019

The UAE Cabinet has approved distribution of the value-added tax (VAT) revenues totalled approximately AED27 billion between the federal and local government.

According to the decision 30 percent of the revenue will go to the federal government, and 70 percent to the local governments.

The decision ensures the sustainability and the quality of government services. It also contributes to the development of economic and social projects and public services.

The VAT was introduced in the UAE on 1st January 2018. The rate of VAT is 5 percent. VAT provides the UAE with a new source of income which will be continued to be utilised to provide high-quality public services.

Information Source : https://www.tax.gov.ae/en/press-releases/UAE-Cabinet-approves-VAT-revenues

All Indian expats working in UAE must register online

From January 1, those with job visas in 18 countries must sign up on emigrate portal

Dubai: The Indian government’s new online registration will be applicable to all Indians working in the UAE and 17 other notified countries from January 1, 2019, Gulf News can reveal. Those who fail to do so will not be allowed to board their flights to these countries.

On Tuesday, Gulf News reported that India made online registration mandatory for all Indians holding non-emigration clearance required (Non-ECR or ECNR) passports who have employment visas to 18 notified countries, including the UAE. Now, Indians already working in these countries also have to register when they visit their home country, a senior official confirmed.

Speaking over phone from New Delhi, M.C. Luther, joint secretary for overseas employment and protector general of emigrants, clarified that only one-time registration is required as long as an Indian remains on the same company’s employment visa. It is not necessary to register every time one goes back home unless there is a change in visa.

Registration must be completed on the eMigrate portal between 21 days and 24 hours prior to the date of travel.

Those who fail to do so will be offloaded, according to a recent advisory issued by the Ministry of External Affairs.

Emigration Clearance Required (ECR) passport holders who change their passport status to ECNR after three years of overseas employment will also have to complete the ECNR registration.

Explaining the rationale behind the move, Luther said: “It is to obtain details such as who the employer is, their contact and address details and who we can reach in case of an emergency. The idea is to be able to reach them [applicants or their emergency contact] in India and abroad if there is a need for assistance.”

Equating the ECNR registration form to the departure card issued by the Bureau of Immigration, which was discontinued in July 2017, Luther said this new move is a “completely non-intrusive form to respect the privacy of individuals and their employers”.

He stressed that the registration will not be used to tackle cases of bogus job offers or contract substitution. In such cases, workers have to use existing methods of grievance redressal. However, officials can check recruitment done through approved agents since the latter also have to provide these details on the same portal.

Luther pointed out that about 40,000 ECNR passport-holders have voluntarily registered after approved recruitment agents were intimated about the pilot phase.

Key points

All Indians holding ECNR passports with overseas employment visa should register on https://emigrate.gov.in/ext/preECNREmig.action before flying out of India.

Registration is mandatory for Indians taking up jobs in 18 notified countries: Afghanistan, Bahrain, Indonesia, Iraq, Jordan, Kuwait, Lebanon, Libya, Malaysia, Oman, Qatar, Saudi Arabia, Sudan, South Sudan, Syria, Thailand, UAE and Yemen.

Those already working on employment visas in these countries will have to register when they visit India and fly back again.

They need to re-register only if their work visa has changed.

Details to be furnished include personal, visa and travel details, emergency contact details in India and destination country and contact details of foreign employer/sponsor in the destination country.

On successful completion of registration, the applicant will receive an SMS/email.

From January 1, 2019, failure to register will result in applicant getting offloaded.

News source from : Gulf News

https://gulfnews.com/uae/all-indians-must-register-online-before-flying-to-uae-for-work-1.60461934