Friday, November 24, 2017

RTA proposed no driving license for select expat categories in UAE

Regulating the registration permits of old vehicles, and linking registration and licence fees of vehicles to engine capacity are among other ideas.
The Roads and Transport Authority (RTA), in an attempt to further reduce congestion on roads in Dubai, is mulling several proposals, including regulating the issuance of driving licences to select categories of expats.

In a letter by the authority to an Arabic newspaper, the RTA said it has identified means that could help alleviate the traffic problem in the emirate, especially during office hours.

Regulating issuance of driving licences, regulating the registration permits of old vehicles, linking registration and licence fees of vehicles to engine capacity and annual consumption of fuel and annual distance travelled, modifying registration fees for environment friendly vehicles, and incentives to e-vehicles are the ideas on the table that may be implemented after consultation with at the federal level, the RTA letter stated.

Among sustainable solutions that may be implemented within the emirate include encouraging the public to use public transport, improving the vehicle rental market, adjusting start times of schools and offices to reduce the burden on the roads, the letter further added.

Sunday, November 19, 2017

Commercial Property sales and Lease attract VAT in UAE

The UAE implementing value-added tax (VAT) from January 1 2018, and businesses can start now register on the website of the Federal Tax Authority (FTA). Commercial property sales and leases will be subject to the standard rate of VAT (five percent), residential property sales and leases will be exempt from VAT, with the exception of the first sale of new residential property, which will be subject to the zero rate of VAT, and bare land will be exempt from VAT.

What is a supply in relation to real estate?

A supply of real estate may include the sale, lease or giving the right in any real estate.

What is a residential building for VAT purposes?

A residential building is a building or part thereof that is intended and designed for occupation by individuals, and mainly includes buildings which can be occupied by any person as a main place of residence. It does not include:

  • Any place that is not a building fixed to the ground and can be moved without being damaged.
  • Any building that is used as a hotel, motel, bed and breakfast establishment or hospital or the like.
  • A serviced apartment for which services in addition to the supply of accommodation are provided.
  • Any building constructed or converted without lawful authority
 What is a commercial building for VAT purposes?

A commercial building is any building or part thereof that is not a residential building. Examples would be offices, warehouses, hotels, shops, etc

Is a residential building subject to VAT?

The first supply of a new residential building within the first three years of it being constructed shall be zero-rated. All subsequent supplies shall be exempt, even if within the first three years

Does the owner of real estate have to register for VAT?

The owners of residential buildings do not have to register for VAT if they do not have any other business activities. Where owners have other business activities, they should consider their obligations further.The owner of any building that is not residential, will have to register if the value of the supplies over the preceding 12 months exceeds Dh375,000 or it is expected that they will exceed Dh375,000 over the coming 30 days.

Can a real estate owner recover VAT paid in relation to real estate?

An owner of the residential building will not be able to recover VAT in respect of expenses related to the exempt supply of the residential buildings.An owner of a commercial building will generally be able to recover VAT in respect of expenses related to the supply of the building.

How is a mixed-use building (residential and commercial) treated for VAT?

The rent or sale of a residential part of the building shall be treated as zero-rated or exempt, depending on whether this is a first supply or a subsequent supply.The rent or sale of a commercial part of the building shall be treated as subject to VAT at 5%.

The tax incurred by the owner on the building needs to be apportioned where there is an exempt supply, and the portion related to the taxable supply (at 0% and 5%) may be recovered.

Will VAT be charged for the property I am renting?

The rent of residential building will generally be exempt from the VAT.The rent of commercial building will be subject to VAT at 5%.

Tuesday, November 14, 2017

Fines to replace court trials in minor offences in Dubai from December 4th 2017

From December 4, 2017, on-wards, prosecutors in Dubai will be able to fine suspects involved in certain types of misdemeanor and minor offenses, including some bounced cheque and cursing cases, instead of referring them to court.

Dubai’s Attorney-General Essam Eisa Al Humaidan issued decision No. 88 of 2017, according to which prosecutors of the of Deira, Bur Dubai, and Family and Juvenile's prosecution wings can start issuing criminal orders starting December 4.

According to Al Humaidan’s decision, members of the three prosecution wings can fine suspects involved in specific minor offences rather than indicting them and referring them to the Dubai Misdemeanours Court to stand trial.

The list of misdemeanours is limited to certain minor offences including bounced cheques up to Dh200,000, failing to pay for food, car rent or room rent up to Dh50,000, defamation and cursing [excluding government sector employees], attempted suicide and disturbing victims through the use of telecommunication systems.

Prosecutor-General Mohammad Ali Rustom, Head of the Family and Juveniles Prosecution, told Gulf News on Monday: “The criminal order is an excellent step and a timely one as well. It has come to solve many hindrances and delays that litigants face. The litigation process requires a prosecutor to issue a decision on whether or not to indict a suspect and refer him/her to court or dismiss the case. Litigants [suspects and/or victims] used to wait for long periods … but now the criminal order has come to save the time for litigants and, remarkably, tourists.”

Dubai is a major international tourist hub attracting millions of visitors every year, many of whom could get involved in misdemeanours, he said.

“There have been cases involving tourists, who came here to enjoy their holidays but ended up getting stuck for weeks and months after having committed minor offences. In certain incidents, some litigants had to wait for six months. The criminal order reduces the waiting time for tourists, who end up being involved in such misdemeanours, and who do not have to wait for long periods waiting to be referred to the Misdemeanours Court … in case they are guilty, they pay a fine rather than waiting,” Rustom told Gulf News.

A chief prosecutor, who preferred not to be named, said the criminal order assists Dubai Public Prosecution in achieving its goals to make procedures faster and easier to complete for litigants in cases pertaining to specific minor crimes.

According to the Attorney-General’s decision, a copy of which was obtained by Gulf News, Rustom; Prosecutor-General Yousuf Foulad, head of the Deira Prosecution; and Prosecutor-General Sami Al Shamsi, head of the Bur Dubai Prosecution, are entitled to assign a prosecutor to issue, amend or cancel a criminal order.