Detailed Overview of FTA Private Clarifications Guide | AB Capital Services

The FTA Private Clarifications Guide are useful in responding to particular questions on taxes and compliance. The following breaks down the content of the guide in a nutshell, touching on every vital aspect like eligibility, how to go through the process, mistakes to avoid, and brief information on other services offered by AB Capital Services.

1. What Are Private Clarifications?

Formal responses by the FTA to specific taxpayer inquiries about tax matters are called private clarifications. Purpose of these documents is to clear all the confusions and to make tax in the UAE easy to file.

• Scope:
  Private clarifications are only for the applicant and are based on the information provided by the applicant. The FTA doesn’t independently verify the facts, but may ask for more details.
• Validity:
  Unless there is fraud, misrepresentation or changes in circumstances, such as new legislation, they remain valid. The FTA can withdraw a clarification, but taxpayers may rely on it until its withdrawal date.
• Superseding Clarifications:
  An additional clarification is issued, if so, it overrides the one issued from the effective date.

2. Eligibility Criteria

• Who Can Apply?
  • Individual taxpayers.
  • Representative members of tax groups.
  • Tax agents or legal representatives registered for the specific tax type.
    Unauthorized representatives like tax consultants or advisors cannot apply unless there are exceptional cases involving joint requests.
• Eligible Tax Matters:
  Clarifications must address specific uncertainties related to federal taxes or penalties. Applicants should clearly outline the tax type and provide supporting documents.
• Grounds for Rejection:
  • Ineligible applicants.
  • Incorrect or incomplete submissions.
  • Hypothetical queries or matters already addressed by the FTA in public clarifications.

3. How to Submit a Clarification Request

Applications for clarifications are submitted through the EmaraTax platform, following these steps:

1. Complete the Clarification Request Form:
   Include detailed information about the tax matter, relevant facts, and a technical analysis.
2. Upload Supporting Documents:
   Contracts, invoices, or professional tax advice.
3. Pay Fees:
   • AED 1,500 for single-tax requests.
   • AED 2,250 for multi-tax requests.

Note: Drafts must be finalized within 40 business days, and submissions made after 3 PM are processed the next working day.

4. Issuance Timelines

• Indirect Taxes (VAT, Excise): Within 50 business days from submission or receipt of additional information.
• Corporate Tax: Within 60 business days.
• Complex Cases: Extensions may be requested.

For multi-tax applications, separate clarifications are issued for each tax type.

5. Refund Policy

The FTA offers partial or full fee refunds under specific circumstances, such as duplicate requests or withdrawals, within two business days. Refund amounts vary based on the type of request and the number of taxes clarified.

6. Common Mistakes to Avoid

Applicants should be cautious of:

• Submissions from unauthorized representatives.
• Incomplete forms or contradictory information.
• Queries based on non-UAE laws or already clarified matters.

7. Leveraging Professional Assistance

Understanding the nuances of the FTA’s clarification process can be challenging. Here, professional tax advisors like AB Capital Services play a crucial role as they are FTA Certified Tax Agency in the UAE. They offer expert guidance, ensuring compliance, accurate submissions, and streamlined communication with the FTA.

Conclusion

FTA private clarifications are an indispensable tool for resolving tax uncertainties, provided applicants adhere to the prescribed guidelines. By avoiding common errors and seeking professional support from trusted firms like AB Capital Services, taxpayers can navigate the process with confidence.

Would you like assistance with creating a tax clarification request? Reach out to AB Capital Services for expert advice today by booking a Free Consultation here!

FAQs

1. What are FTA private clarifications?
   FTA private clarifications are formal documents issued by the Federal Tax Authority to address specific tax-related queries of individual taxpayers based on submitted facts and documents.
2. Who is eligible to apply for private clarifications?
   Individual taxpayers, representative members of tax groups, and registered tax agents or legal representatives can apply. Tax consultants or unauthorized representatives cannot submit requests.
3. How long does the FTA take to issue a clarification?
   The issuance timeline is 50 business days for indirect taxes (VAT, Excise) and 60 business days for corporate tax. Extensions may be granted for complex cases.
4. What are the fees for submitting a clarification request?
   The FTA charges AED 1,500 for single-tax requests and AED 2,250 for multi-tax requests. Fee refunds are available under specific conditions.
5. How can AB Capital Services help with FTA private clarifications?
   AB Capital Services provides expert assistance in preparing and submitting clarification requests, ensuring compliance and accuracy to streamline the process.