A provisional Tax Registration Number is sufficient for commercial activities
The Federal Tax Authority (FTA) has confirmed that businesses do not need to present a tax certificate to conduct commercial activities and can use their provisional Tax Registration Number (TRN).
In a statement issued on Saturday, the FTA urged businesses to comply with the directive in order to minimise disruption to business in the UAE.
It also noted that the tax registration certificate cannot be printed or downloaded using a provisional TRN. However, businesses can verify the TRN of any company registered with the FTA for VAT purposes on the FTA website.
Provisional TRNs were issued as a way to keep operations running smoothly for businesses that submitted their registration applications after the December deadline set by the FTA.
Those businesses are still required to complete their tax registration and must provide all relevant documents to the FTA. A tax certificate is granted once the final TRN has been issued.
Khalid Al Bustani, director general of the FTA said last week that at least 260,000 companies and more than 10,000 groups comprising multiple companies have registered for VAT.
He also warned companies that have an annual turnover of more than AED375,000 to register without further delay.
“If the companies do not register they will be breaking the law. Companies who are ready to register should not delay the process.”
The launch of VAT took effect on January 1 at a rate of five percent. Certain foods and services, including education and healthcare, are exempt.
According to IMF estimates, even this modest rate is expected to realise VAT revenues of up to 1.6 percent of GDP in the GCC countries.