Businesses residing in any GCC State that is not considered to be an Implementing State may still apply to reclaim VAT incurred in the UAE under this scheme, the FTA assured, outlining only three situations where VAT cannot be reclaimed: If the Foreign Business in question makes supplies in the UAE, unless the recipient is obliged to account for VAT under the Reverse-Charge Mechanism; if the Input Tax in respect of any goods or services is non-recoverable as per VAT legislations, therefore, not recoverable by a Taxable Person
in the UAE; and finally, if the Foreign Business is a non-resident tour operator.
A taxable person
will not be allowed to apply the profit margin scheme in cases where they had issued a tax invoice or any other document mentioning an amount of VAT chargeable in respect of the supply, the FTA explained, noting that taxable persons
are required to keep inventory and similar documents that clarify the situation of every item bought or sold, as well as purchase invoices that outline the details of items bought under the profit margin scheme.
The guide outlines a simple, four-step process allowing e-Services users to connect with and gain access to a taxable person
's account via the "taxable person
While the sale of vacant commercial properties or the off-plan sale of commercial properties under the building license, are subject to a 5% VAT, the tax paid during the lease period can be recovered through the tax return of the tenant if they are a taxable person
registered for tax purposes and entitled to tax refund.
As such, taxable persons
(whether businesses or an individual with an annual supply threshold of at least $100,000 registered with the competent tax authority) need to understand the underpinning principles of intra-GCC trade in the post-VAT era.
However, if you are then deemed a US taxable person
, your account may become limited in options, frozen or even closed.
In its judgement, the court held, firstly, that the question of whether the VAT due has or has not been paid to the public treasury has no influence on the taxable person
's right to deduct input VAT.
A natural person shall not be considered a taxable person
in respect of the supply of goods and/or services if the transactions concluded by the natural person are not related to the economic activities carried out by him.
The councils say they should be exempt from VAT because they are public authorities and not "taxable persons
" under an EU VAT Directive.
Company A does not charge VAT on that supply if Company B is a taxable person
in another EC jurisdiction and has supplied Company A with its VAT registration number.
In that instance, they would have to charge VAT themselves and recover the money that way: "When the taxable person
has effected onward taxable transactions in that territory, he no longer has the right to a refund of that VAT under the eighth directive."
The decision followed on the heels of a European Court of Justice ruling where it was held that if fundraising was for the purpose of the business's economic activity VAT was recoverable because the taxable person
was making taxable supplies.