It is very common in UAE that companies form a structure of separate legal entities and hold themselves under the holding company. FTA has provided a special provision for such entities called tax group. Under Tax Group two or more legal entities registers themselves as single entity for tax purposes. Registering a VAT Group can be done at any time. Entities can apply for the tax group if all of the following conditions are met:
- Each shall have a Place of Establishment or Fixed Establishment in the State.
- The relevant persons shall be Related Parties.
- One or more persons conducting business in a partnership shall control the others
Companies will be required to apply for the tax group with FTA, applications will be reviewed and they will be allowed to treat themselves under tax group once they are approved by the authority. FTA may reject the case if they think case is being applied for tax evasion purposes or any of the requirement mentioned above is not met. Tax Group will definitely give a centralized way of filing returns and hence reducing the administration cost for the corporates.
We at Tech Ventures provide the solutions and consulting in order to ensure your company is compliant with tax regulations of UAE. We expertise in implementing Microsoft Dynamics ERP Solutions and custom applications. For more information drop an email at email@example.com or Register for our free overview session.