Tax Registration is necessary under the UAE Corporate Tax Law for implications of corporate tax to be levied on entities. The Ministry of Finance, UAE has issued a decision underlining certain specific entities that do not have to register for Corporate Tax and are exempted.
Exemption from Tax Registration under UAE Corporate Tax Law
Certain entities are exempted from registration under the UAE Corporate Tax Law. These are as follows:
Government Entity or,
Government Controlled Entity or,
The person undertaking Extractive Business Activity as per Article 7 of the UAE Corporate Tax Law or,
The person undertaking Non-Extractive Natural Resource Business as per Article 8 of the UAE Corporate Tax Law or,
Non-Resident deriving UAE sourced income but doesn’t have Permanent Establishment (PE) in UAE.
Note: If certain entities become Taxable Persons under the UAE Corporate Tax Law and have to register for the Corporate Tax, these entities can register for the same notwithstanding this decision by MOF of exemption:
Government Entity;
Government Controlled Entity;
Extractive Business;
Non-Extractive Natural Business.
Publication and Application
The decision by MOF will be published and will become effective from the day after publication.
Conclusion
Thus, it can be concluded that these five entities are exempted from registration under the UAE Corporate Tax Law. Though, if they become a Taxable Person, then, they have to register for the same.
PAN Aadhaar linking has become a necessity in today’s times. It is a well-known fact that Aadhaar and PAN are two of the most important documents for Indian citizens. So, let’s understand the importance of the two documents and their linking.
Aadhaar is a 12-digit unique identification number. The Unique Identification Authority of India issues it to the citizens of India and is issued under Section 3 of The Aadhaar (Targeted Delivery of Financial and Other Subsidies, Benefits, and Services) Act, 2016.
While Permanent Account Number (PAN) Card is a 10-digit unique alphanumeric identification number. The Income Tax Department issues it under Section 139A of the Income Tax Act, 1961. One of the main reasons why linking the two has been mandated is because it helps keep track of transactions i.e., an audit trail entered into by the taxpayer.
Legal provisions relating to linking of Aadhaar with PAN
Section 139AA of the Income Tax Act, 1961 provides for mandatory linking of Aadhaar and Pan Cards. It states that “Every person who is eligible to obtain an Aadhaar number shall, on or after the 1st day of July 2017, quote Aadhaar number —
(i) in the application form for allotment of permanent account number;
(ii) in the return of income:
……………….”
Moreover, subsection (2) of Section 139 AA of the Income Tax Act, 1961 states “Every person who has been allotted a permanent account number as of the 1st day of July 2017, and who is eligible to obtain an Aadhaar number, shall intimate his Aadhaar number to such authority………………………”
Furthermore, it states that if an individual doesn’t link both documents, he will be liable to a penalty and his PAN Card will be considered invalid.
For whom it is not mandatory:
As per Notification №37/2017 dated 11th May 2017, it is not mandatory for an individual to link their Aadhaar to their PAN, if such a person is:
Residing in the States of a. Assam, b. Jammu and Kashmir, and c. Meghalaya; or
Non-resident as per the Income-tax Act, 1961 or;
80 years of age or more at any time during the previous year or;
not a citizen of India.
Constitutional Validity of Aadhaar and Pan Card Linking:
The Supreme Court of India, 2018 upheld the constitutional validity of linking one’s Aadhaar with their PAN and held that it is mandatory for income tax returns filing.
Benefits of linking Aadhaar with PAN
Following are some of the benefits of linking both documents:
Prevents tax evasion.
Furthermore, it helps the Government to easily identify who has multiple Pan Cards and take necessary action.
Moreover, it helps in faster processing of Income Tax Returns as personal details like name, address, and date of birth are automatically verified and taxpayers receive their refunds faster.
It also eliminates the risk of identity theft and fraud.
Procedure for Aadhaar PAN linking:
Linking of the Aadhaar and PAN can be done via both online and offline modes.
Online linking process
The online process for linking your Aadhaar with your PAN is as follows :
Visit the nearest PAN service center or Aadhaar Enrollment Center.
Fill out Form 49A for PAN and Form Aadhaar Enrollment Form for Aadhaar.
Submit the forms along with your PAN card and Aadhaar card.
After the documents are verified, your Aadhaar and PAN will be linked.
Common Errors and Solutions:
Spelling mismatch in the Name of the Aadhaar and PAN Card was found as the most common error during the filing procedure.
In order to solve this error, the Government decided to change the spelling of any of the documents to make them compliant with the other one.
Recently, the Income Tax Department with a view to addressing this issue made a tab called “Links to correct name” which allowed taxpayers to address this error very quickly and efficiently.
Furthermore, individuals can also check the status of their request on the Income Tax Department’s e-filing website.
In case of any other issues, taxpayers can contact the Income Tax Department’s customer care helpline or visit the nearest PAN service center or Aadhaar Enrollment Center.
Deadline for PAN Aadhaar linking:
The deadline for linking your Aadhaar and your PAN has been extended to 30th June 2023.
Conclusion:
The process of linking one’s Aadhaar with their PAN is mandatory and has been upheld by the Supreme Court in its judgment. The linking helps the Government in checking tax evasion, faster processing Income Tax Returns and Refunds, and reduces the risk of identity theft and fraud. The procedure is quite simple and quick and can be done in both online and offline modes. So, it is advisable that all Indian Citizens should link both these documents to avoid any consequences.
Contact us at Sorting Tax to link your PAN and Aadhaar today.
The UAE’s Federal Tax Authority (FTA) has released a comprehensive guide that outlines the UAE Corporate Tax Law Procedures which detail the tax administrative and enforcement procedures necessary for the effective implementation of the UAE Corporate Tax Law . As of March 1, 2023, the Decree Law on Tax Procedures is in effect, and the guide includes the rights and responsibilities of all stakeholders, including taxpayers, the FTA, and other individuals who fall under the Law’s purview.
The basic framework of the provisions of the UAE Corporate Tax Law Procedures are as follows:
Title 1: Definitions and Scope of Application
Article 1- Definitions
Article 2- Objectives of the Decree- Law
Article 3- Scope of Application of the Decree- Law
Title 2: Tax Obligations under UAE Corporate Tax Law Procedures
Chapter One: Keeping Accounting Records and Commercial Books
Article 4- Record Keeping
Article 5- Language
Chapter Two: Tax Registration
Article 6- Tax Registration, Deregistration and Amendment of Registration Data
Article 7- The Legal Representative
Chapter Three: Tax Return and Tax Payable
Article 8- Tax Return Preparation and Submission
Article 9- Determination of Payable Tax
Chapter Four: Voluntary Disclosure
Article 10- Instances as to when taxpayer can submit Voluntary Disclosure
Title 3: Tax Procedures
Chapter One: Notification
Article 11- Methods of Notification
Chapter Two: Tax Agents
Article 12- Registration of Tax Agent
Article 13- Conditions of Registration of the Tax Agent, Suspension of Registration and Deregistration
Article 14- Appointment of the Tax Agent
Article 15- Person’s Records with the Tax Agent
Chapter Three: Tax Audit
Article 16- The Right of the Authority to Perform a Tax Audit
Article 17- The Right of the Authority to Obtain the Original Records or Copies thereof during the Tax Audit
Article 18- Timing of the Tax Audit
Article 19- New Information surfacing after the Tax Audit
Article 20- Cooperation during the Tax Audit
Article 21- Rights of Persons subject to Tax Audit
Article 22- Notification of Tax Audit results
Chapter Four: Tax Assessment and Administrative Penalties
Article 23- Tax Assessment
Article 24- Administrative Penalties Assessment
Chapter Five: Penalties, Procedures and Measures
Article 25- Tax Crimes and their Penalties
Article 26- Procedures and Measures
Article 27- Reconciliation and Tax Evasion Crimes
Title 4: Review of Assessment, Objection and Appeal
Chapter One: Tax Assessment Review Request
Article 28- Tax Assessment Review Request
Chapter Two: Request for Reconsideration
Article 29- Request for Reconsideration
Chapter Three: Objection made to Committee
Article 30- Tax Disputes Resolution Committee
Article 31- Jurisdictions of the Committee
Article 32- Procedures for submitting the Objection and cases of Non-Acceptance
Article 33- Procedures of the Committee
Article 34- Enforcement of the Committee’s decisions
Article 35- Extension of Deadlines
Article 36- Procedures for Appeal before Courts
Article 37: Special Procedures for Objection and Appeal
Title 5: Refund and Collection of Tax
Chapter One: Refund of Tax
Article 38- Application for Tax Refunds
Article 39- Tax Refund Procedures
Chapter Two: Collection of Tax
Article 40- Collection of Payable Tax and Administrative Penalties
Chapter Three: Settlement and Collection of Taxes and Administrative Penalties in Special Cases
Article 41- Responsibility of Settlement of Tax and Administrative Penalties in the case of Partnership
Article 42- Settlement of Tax and Administrative Penalties in Special Cases
Article 43- Settlement of Tax and Administrative Penalties in the case of Bankruptcy
Title 6: General Provisions
Chapter One: Confidentiality and Conflict of Interest
Article 44- Professional Confidentiality
Article 45- Conflict of Interest
Chapter Two – Time Periods and Lapse of Time
Article 46- Statute of Limitation
Article 47 – The Authority’s Right to Claim
Article 48 – Period for Tax Obligations
Article 49 – Calculation of Time Periods
Article 50 – Controls for Paying by Instalment, Waiving, or Refunding of Administrative Penalties
Chapter Three – Miscellaneous Provisions
Article 51- Proving Accuracy of Data
Article 52- Judicial Officers
Article 53- Tax Resident
Article 54- Authority’s fees
Article 55- Abrogation
Article 56- Executive Regulation
Article 57- Publication and Application of the Decree-Law
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