Much required feature on Emaratax is now available. The Change Entity type without needing to de-register and then register.
Many businesses, especially Sole Establishment although being a natural person had been registered as Legal Person since the inception of VAT and continued so.
Now when Corporate Tax is there, it has become vital to have your business registered with correct entity type because each entity type has different corporate tax implications.
Previously, to change your entity type, you had to De-register and then register with your correct/updated entity type.
I just logged into one of my clients Emaratax account today and found FTA has now provided feature in Emaratax to change entity type. I would highly thank FTA for this much needed feature.
I just opened the request, and it seemed very simple process with the following requirements being mentioned there on Emaratax.
Required Documents for changing entity type in Emaratax.
You will be required to provide the following documents when requesting for a change in your entity type.
A. Proof of change in your entity type.
B. If you are changing your entity type to “Natural Person”:
1. Emirates ID/Passport of the Taxable Person
2. Trade Licenses
C. If you are changing your entity type to “Legal Person” or “Partnership”:
1. Certificate of Incorporation
2. Trade Licenses
3. Emirates IDs, Passports and Trade Licenses of owners/partners
Accepted file types are PDF, DOC and DOCX. The individual file size limit is 15 MB.
Eligibility Criteria for change entity type in Emaratax.
The information given below is intended to help determine your eligibility to apply for this service.
You may request to change your entity type if there is a change in your business, or if you registered under an incorrect entity type by mistake, or for any other reason (in which case you will be required to provide further details). You will be allowed to change your entity type only once.
Service Steps for changing entity type in Emaratax:
Step 1-Please check the eligibility criteria, require documents.
Step 2-Complete and submit the online application.
FAQs
1. By When should I submit the application to change my Entity type?
You must submit your application to change your entity type within 20 business days from the date of the change.
2. Can I save the application as draft to be updated later? If yes, for how long?
Yes, you can save the in-progress application as a draft and complete it at a point in time. However, if you do not submit your application within 60 calendar days of initiating it, your application will be automatically canceled. There will be reminder notifications set to your registered email/verified mobile.
3. What is the estimated time to complete application review by the FTA?
Generally, the estimated time to complete the application by FTA is 20 business days from the data the completed application was received by the FTA. However, in case where any additional information is needed, the FTA may take additional time to process the application. The applicant need to provide additional information and re-submit the application. It may take the FTA a further 20 business days to respond to the updated application. If the application is not resubmitted within 60 calendar days from the date you received the notification from the FTA, the application will be automatically rejected.
Well, I tried to change the entity type for one of my client, who was natural person but registered with wrong entity type as “Legal Person-Incorporated”, but it did not go through with following error.
“Your Entity Type is currently not allowed to be changed.”
I have already submitted de-registration request for this client which is awaiting approval even after 3 months. May be this is the reason for above mentioned error and we need to request FTA to cancel that de-registration request so that we could proceed with change entity.
So this that we as of now, will surely update once we get to know more about after having successful change entity case.
If you need our help in changing your entity type which you register wrong earlier. We are here to help you with this. Contact us for any kind of support in tax and accounting.
