How do you know when registering for VAT is necessary?

Did you know that natural persons, people like you and me, could get fined for not registering for VAT, even if we don’t operate a business? 

I prepared a video that explains if and when you, as an individual, need to register for VAT. I will show you which specific situations when you are legally required to register plus more. 

Let’s get back to the basics.

The FTA requires “persons” engaging in economic activities and making taxable supplies who meet specific criteria to register for VAT. 

When we think of those “persons,” what should come to mind are “legal persons.” 

Legal persons are businesses registered as corporations, limited liability companies, or sole proprietorships. 

Those businesses are required to collect VAT from their customers, pay VAT to their suppliers, and make regular tax filing with the FTA. 

But what about real people?  Real people are “natural persons” in legal terms. So should they register for VAT if they make “taxable supplies?” 

And can individuals make taxable supplies without operating a business? 

The answer is yes! 

Let me give you a few examples:

If you own real estate properties in your name and you are renting the properties out, then you may have to register for VAT.

If you as an individual provide consulting or advising services, then you may have to register for VAT.

Keep in mind, This by no means an exhaustive list of cases. You need to look at the “supplies” you are making as an individual and check if they meet the FTA’s definition. 

I should tell you that If you’re performing any business activities under an employment contract, you are not subject to VAT registration.

In other words, if you are already working for a business and that business is already registered for VAT, then you don’t have to “individually” register for VAT. 

And there you have it: Now you know when you need to 

register for VAT!

I’d love to hear what you thought about the video! Please leave a comment or question below. Feel free to share and like it, too!