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TaxFlash

4 February 2021

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This TaxFlash has been designed to keep our valued clients up-to-date with relevant tax developments. Please contact the Keypoint tax team if you have any questions about this TaxFlash. Click here if you'd like to be added to our mailing list.
Bahrain
  • As part of its ongoing upgrade of the regulatory environment, Bahrain has ratified the multilateral competent authority agreement on the exchange of country-by-country reports. The MCA should increase transparency and collaboration between competent authorities on international tax matters.
  • All taxable persons should assess whether an adjustment is required in relation to input tax recovered during 2019 relating to capital assets – see our technical tip below.  Adjustments should be made through the first VAT return of 2021 if an adjustment was not made in the last tax period of 2020.
VAT in the GCC
 
With VAT starting to feel like business as usual for key decision makers at many GCC businesses, there couldn’t be a better time to launch a VAT survey!

Our Keypoint VAT benchmark – which will be repeated periodically – should take no more than five minutes to complete and is completely anonymous. Designed to identify some of VAT’s key impacts, your answers will help to develop clear insight into the maturing GCC market. Participants will receive a summary of our findings, allowing them to benchmark themselves against the market. Kindly submit your responses by Sunday 7 February.

Please click here to complete the survey.
TaxMatters 6
 
Join our tax leaders for a brief webinar on Monday 8 February, discussing tax developments in the UAE, Saudi Arabia and Bahrain including:

• Tax updates
• VAT issues
• Other tax-related developments

To register, please click here.
Saudi Arabia
  • GAZT is continuing its inspection campaign, conducting over 2,700 inspections and finding over 300 tax violations over the last week.
  • GAZT has started issuing transfer pricing (TP) queries, requesting TP local files and supporting documents, such as related party agreements and pricing benchmarks.
Oman
  • The Oman Tax Authority started accepting VAT registration applications on 1 February 2021 for taxable persons with annual taxable supplies exceeding or expected to exceed OMR1m.
  • Further VAT guides have been published by the Oman Tax Authority, including VAT registrations for residents without a CRN, VAT registration applications for non-residents and a VAT registration manual.
UAE
Qatar, Kuwait
  • No updates this week.
Technical tip
Capital assets

 
What is a capital asset (for VAT purposes)?
 
Capital assets – which can be either tangible or intangible - are both material and immaterial goods and services that are allocated by a business for long-term use as a business instrument or as a means of investment. Items for resale are not considered capital assets for VAT purposes.
 
How does the VAT treatment of a capital asset impact my business?
 
Most businesses are likely to have some capital assets – even something as small as a laptop or PC – to run their day-to-day business. Where the actual use of a capital asset differs from its intended use on purchase, an adjustment is likely to be required.
 
Examples of capital assets
 
Intangible capital assets include software, trademarks and royalty agreements. Tangible capital assets include machinery, land and buildings.
Our services

Our recently updated tax services brochure gives you a clear and succinct summary of the current tax landscape in the GCC. Click on the image for more details - or speak to your regular Keypoint contact for more details:

Mark Gamble
Head | Indirect tax

mark.gamble@keypoint.com
+973 3833 8641
+973 1720 6872

Raman Ohri
Head | Direct tax

raman.ohri@keypoint.com
+973 3516 2335
+966 50 286 4266

Tariq Haq
Manager

tariq.haq@keypoint.com 
+973 1710 3480
+973 3628 3351

Dinesh Ravi
Manager

dinesh.ravi@keypoint.com 
+966 13 845 9228
+973 3628 3359

Adil Fawzi
Manager

adil.fawzi@keypoint.com 
+966 13 845 9226

+966 5 3251 0366
Website
Link

© 2021 KEYPOINT - DISCLAIMER

TaxFlash is intended to provide general updates in relation to tax in the GCC. It is not a substitute for professional advice. You should seek appropriate professional advice from a tax advisor before making any decision relating to your particular circumstances.
 
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