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UAE ‘sole establishment’ VAT registration

The Federal Tax Authority of the United Arab Emirates (UAE) has confirmed that sole traders (‘sole establishment’) – individuals not incorporated – may apply for a VAT number for their business(es).

UAE VAT obligations

The sole trader may apply in their own name or the business trading name of their businesses. The value of supplies made by the natural person and all its sole establishments must be aggregated to assess whether the VAT registration threshold has been exceeded.

The UAE VAT registration threshold is AED 375,000 per annum. It is possible to voluntarily register if the combined turnover is above AED 187,500.

UAE VAT introduction

The UAE introduced its 5% VAT regime on 1 January 2018. It was part of a six-state Gulf Cooperation Council plan to create a VAT and Customs Union. So far, Saudi Arabia, Bahrain and Oman have also introduced their VAT regimes. Qatar and Kuwait are still pausing. Saudi Arabia raised its standard rate from the harmonised 5% rate to 15%.

Preparing VAT in any of the new VAT regimes in the Arab Gulf can be challenging.  VAT Calc’s single platform VAT Filer can accurately complete any country filings with verified transactional data from our VAT Calculator or VAT Auditorintegrated tools.

Arab Gulf GCC VAT implementations

Jan 2023 Kuwait decides between VAT or excise taxes
2022 Qatar provisional plans to implement VAT
Jan 2022 Bahrain doubles VAT to 10%
16 Apr 2021 Oman introduces 5% VAT
1 Jul 2020 Saudi Arabia trebles VAT to 15%
1 Jan 2019 Bahrain launches 5% VAT regime
1 Jan 2018 Saudi Arabia and UAE introduce 5% VAT regime
2016 VAT and Customs Union agreement: Bahrain; Kuwait; Oman; Qatar; Saudi Arabia; UAE United Arab Emirates

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