Running a business in Dubai has its fair share of regulations and compliance requirements, including obtaining and verifying your Tax Registration Number (TRN). But what does a Tax Registration Number verification in Dubai entail, and why is it so important?
This article will provide an overview of everything you need to know about Tax Registration Number verification in Dubai and its significance for businesses operating in the region. We’ll also look at different methods of verification and the required documents for the TRN application. So, let’s get started and ensure your business complies with all local laws!
Starting or operating a business in Dubai requires understanding various regulatory requirements and compliance obligations. Among these is obtaining and verifying your Tax Registration Number (TRN) with the Federal Tax Authority (FTA). TRN is an individual identifier assigned to businesses and persons registered for VAT (Value Added Tax). UAE VAT laws are taxes for registered businesses and usually charge VAT of 5%.
When applying for a TRN or tax verification number, the Federal Tax Authority (FTA) will check the provided information to confirm its accuracy and completeness. After processing your application, you’ll receive your Tax Registration Number, which you must use in all VAT-related transactions under UAE VAT laws. However, it’s important to remember that acquiring a TRN isn’t enough; verifying it regularly is necessary to remain compliant with regulations.
As an expatriate looking to start a business in Dubai, you may be wondering whether TRN is the same as a Commercial License or Emirates ID. The answer is no.
Firstly, a Commercial License is a legal document issued by the Dubai Department of Economic Development (DED), which authorises a business to operate within the city’s boundaries. It includes information such as the business name, activities and owner details; it’s mandatory for any business wishing to legally operate in Dubai and cannot be substituted with a TRN.
Secondly, an Emirates ID is another essential requirement for all UAE residents: it contains biometric information, as well as personal details such as name, photo and date of birth. Unlike a TRN, businesses are not obliged to have an Emirates ID for the purpose of registering their business.
Businesses must register and obtain a TRN in the UAE to fulfil several legal obligations, including taxation threshold and VAT payments. It is always important to ensure you fully understand the UAE VAT laws and have a valid TRN. Your TRN number is how UAE VAT charges VAT to businesses, so it’s basically just the regular requirement needed for a business owner for the UAE’s Federal Tax Authority.
Ensuring you have a valid TRN for UAE VAT (you’ll receive a TRN verification Dubai, a VAT registration number and usually a security code), will ensure you avoid any complications with VAT laws or have any Federal Tax Authority issues. It goes without saying, that you should never try to use a fake TRN, as they are immediately reported through the FTA E Services Portal.
Let’s explain further the importance of having a TRN in the UAE for a business owner.
The taxation threshold in Dubai is AED 375,000. This means businesses must register for VAT when their taxable supplies and imports exceed the threshold of AED 375,000 per annum.
Businesses also need a TRN to pay value-added tax (VAT) on goods or services sold within the country. Companies handling taxable supplies or imports exceeding the taxation threshold will be liable to pay 5% VAT on all sales made within UAE borders. Without obtaining a valid TRN, making any payments related to Value Added Tax (VAT) is impossible.
Businesses in the UAE are also subject to a 9% corporate tax on their annual profit exceeding AED 375,000. TRN is mandatory for preparing and submitting your tax files.
A TRN enables your business to conduct various commercial activities in Dubai. For instance, you can issue VAT-compliant invoices to your customers, file VAT returns, and claim input tax credits. This makes it easier for businesses to operate in Dubai and comply with VAT regulations, thereby avoiding penalties and fines.
With a TRN, you can claim input tax credits on your business expenses, which can help you reduce your overall tax liability. This can improve your cash flow and allow you to reinvest the saved funds into your business growth. Businesses must also refer to their TRN when dealing with other corporate entities in the UAE, such as suppliers or customers.
Having a TRN can enhance your business’s reputation and credibility. By obtaining a TRN, you demonstrate that your business complies with the regulations and operates legally. This can boost your customers’ trust in your business and increase your chances of attracting new customers.
Verifying your TRN is essential to ensure you comply with all applicable VAT regulations, avoiding any penalties or fines associated with non-compliance. In Dubai, companies must verify their TRNs before conducting activities such as filing VAT returns, issuing invoices, and making payments related to Value Added Tax.
The government has also found that many fraudulent businesses collect value-added taxes from customers without remitting them to the Federal Tax Authority. If you don’t have a valid TRN, it can be hard to prove that your business is not one of these companies and may attract fines or other penalties.
Moreover, having an up-to-date TRN allows businesses to access various government services, including online filing and payment portals. With a current TRN verification, companies will find it easier to use such services.
Your customers may also want to check your TRN to ensure that you are a legitimate business and that they can receive their refunds. It is also essential for customers when choosing a service provider, as you can trust companies with valid TRNs more than those without.
There are two main methods to verify your TRN in the UAE. The first is a visual check which entails looking at the TRN number carefully and ensuring it is in the correct format. This method is usually used for manual reviews by businesses or customers as it does not require any official government document or process.
The second verification method is official, where you receive a formal confirmation from the Federal Tax Authority online portal. This confirms the accuracy of your TRN and is necessary for all transactions related to Value Added Tax in Dubai.
TRN numbers always appear in a specific format, so ensuring the number you use matches this format is important. The visual verification process includes checking that.
All numbers must start with ‘100’ and contain 15 digits in the format of 100-XXXX-XXXX-XXXX. If it doesn’t meet these criteria, there’s a good chance it’s fake – so don’t proceed with a transaction until you’ve double-checked online with Dubai’s TRN verification service.
Also, if any one of the following applies, it could be a sign of a fake TRN:
- If the length of the number of digits isn’t 15
- It starts with something different to ‘100.’
- In the wrong format (not 100-XXXX-XXXX-XXXX)
Once you know from visual inspection that TRN is genuine, you can proceed with the transaction or further validation through method # 2, as outlined below.
To check if a business or individual is registered for Value Added Tax (VAT) in Dubai, the Federal Tax Authority’s (FTA) TRN verification online portal is your go-to resource.
Through this service, accessible via the Federal Tax Authority website through the direct link or by searching “TRN Verification UAE” or “TRN Verification Dubai” on Google, you can quickly and easily validate any given TRN number.
The direct link to visit the FTA website for TRN verification is: https://www.tax.gov.ae/en/
Once you land on the homepage, you can click on the TRN button from the menu on the right side. It will open a floating window where you can enter the desired TRN.
All you need to do is enter the number of the entity whose registration status you wish to check – it’s that simple! The FTA website is available in English and Arabic.
If a business is registered with the TRN you entered, it will show the business name and TRN side-by-side. You won’t find any legal names assigned to invalid companies.
So, with a few clicks, you can confirm whether someone has obtained their TRN, ensuring you remain compliant with all applicable VAT regulations.
The UAE has strict regulations related to TRN and VAT verification. Fake or incorrect TRNs can result in severe business penalties, including fines, so ensuring you’re working with legitimate entities is crucial.
If you encounter a business or individual using an incorrect or fake TRN, report them immediately by calling the Federal Tax Authority hotline at 800 82923. The hotline is available Monday through Saturday from 7:30 a.m. to 10 p.m.
Additionally, you can fill out the online form on the Federal Tax Authority’s website, which will help the FTA investigate the issue and take the necessary steps.
You can access the contact form at: https://tax.gov.ae/en/contact.us.aspx
The Federal Tax Authority (FTA) allows you to apply for your business TRN online via e-services. Alternatively, you can visit the FTA’s office with all the necessary documents and fill out an application form. FTA’s physical service centre in Dubai is located at the Central Park Business Towers – DIFC.
Registering for a TRN involves submitting documents such as your business licence, Emirates ID or passport copy (for UAE nationals), trade name registration certificate, and other relevant information. After submitting all necessary paperwork, you will receive an official letter from the FTA confirming your registration and providing your TRN.
Generally, the FTA takes about 20 business days to process a completed TRN application. However, if the agency needs additional information, it can take up to 60 days for the applicant to get an official response. To avoid this delay, you should provide all required documents and ensure your applications are complete upon submission. Once approved by FTA, you will receive your Tax Registration Number (TRN) in writing.
Here’s a step-by-step guideline to apply for your TRN online for your TRN Verification Dubai:
- Sign up or log in to your FTA e-services accounts. The entire application process may take approximately 45 minutes.
- At first, you’ll find options to create a profile as a taxable person and once done; you can proceed to the TRN or VAT registration.
- The first step of the registration process will let you provide entity details where you can enter your business name and details.
- The following page, titled “Identification Details” will let you input your commercial licence information. Here you can also enter your business activity, ownership information and branch contact information.
- The following section will show you detailed eligibility criteria.
- Afterwards, the system will ask for complete details on the partnership structure of your business.
- You can also provide bank details, which is optional.
- Next, the system will ask if your business has any activities in one or more of the GCC countries, as the UAE has a separate regulatory and taxation framework for businesses with activities in GCC countries.
- Lastly, you will find an option to upload all relevant documents in PDF or DOC format.
- Once you upload the required documents and submit the application, the application session will end with a confirmation.
Now let’s quickly review the documents you need when applying for a TRN in Dubai.
The FTA requires that you provide the following documents when applying for a TRN:
- Valid commercial licence or trade licence that allows your business to legally operate in the UAE
- Copy of passports or Emirates ID for all the signatories, business contacts, managers, and partners
- Authenticated bank account details from the bank
In addition, you may also need to provide additional documents, depending on your business type and activities. These may include:
- Audit reports or financial statements
- Tax-calculation sheets in the prescribed format
- Declaration of monthly turnover
- Miscellaneous supporting documents, such as tenancy agreements, partnership deeds, invoices and so on.
- Customs documents
- Company Memorandum & Articles of Association (M&A)
- Authorisation and Power of Attorney documents, in applicable cases
- Affiliation documents with any clubs, societies, charities, or social organisations
The TRN application process is free of cost.
Dubai is a vibrant business hub, and obtaining a TRN is crucial for businesses to operate legally and comply with the VAT regulations. Companies risk facing penalties and fines without a TRN, which can significantly impact their finances. A TRN can also enhance your business’s credibility, reputation, and financial management.
If you’re planning to set up a business in Dubai, it’s tremendously helpful to partner with a reliable and experienced business setup service provider. At DUQE, we offer comprehensive business setup solutions that cater to the specific needs of businesses. From obtaining a TRN to obtaining a Commercial License, we can assist you in navigating the regulatory landscape and help you set up your business in Dubai seamlessly.
So, get started immediately, and reach out to DUQE today to start your business journey in Dubai. With our expertise and support, you can easily set up your business and focus on achieving your business goals.