VAT Law has introduced a group registration for tax returns to simplify the procedure for companies and persons. Tax Group is defined under the Value-Added Tax Law as two or more persons registered with the Federal Tax Authority (FTA) for tax purposes as a single taxable person in accordance with the provisions of the VAT Law 2017. Under this law, two or more companies can register for VAT payment or returns as a single entity. In this mechanism, a group of companies or persons get registered in the representation of one company or person to file VAT or VAT returns on behalf of all the group members. All the tax group members are liable for the payment of VAT or returns or any defaults regarding VAT jointly.
The group members are free to do any transactions within their group; they do not need any specific VAT accounting for such transactions. This mechanism is used in several countries, and it is also known as group registration. For the purpose of VAT, the VAT group will be considered as a single company.
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