The tax system in the United Arab Emirates (UAE) has changed a lot in recent years. Since VAT was introduced in 2018, all businesses that need to pay VAT must have a special number called a Tax Registration Number (TRN). Verifying a TRN is very important because some businesses might try to collect VAT without actually being registered.
This kind of fraud can lead to financial losses for the government. To prevent this, the UAE government has made it easy for people to check and confirm if a TRN is valid. This blog will guide you through what a TRN is and how you can check a VAT registration number in the UAE.
What is a TRN in the UAE?
In 2018, the UAE government introduced a 5% Value Added Tax (VAT) on goods and services to help increase national income and rely less on oil. To manage this system, the Federal Tax Authority (FTA) gives each VAT-registered business or person a special number called a Tax Registered Number (TRN).
Each registered business gets its own unique TRN. This 15-digit number helps the FTA keep track of who is registered and monitor all taxable transactions. Moreover, the TRN helps the government identify one VAT-registered business apart from another and is used to make sure companies follow the VAT laws. It also helps spot businesses that are not following the tax rules properly.
Also Read: Understanding the Difference Between VAT Exemption Number and TRN in the UAE
Why is a TRN important in the UAE?
The TRN certificate in Dubai is a key part of the VAT (Value Added Tax) system in the UAE. It serves several important purposes that help businesses follow the law and build trust.
Claiming VAT back on purchases
A TRN is needed if a business wants to get back the VAT it paid on goods or services. Also, checking the TRN of suppliers helps businesses confirm they are dealing with registered and legal vendors. This makes it easier to claim input tax properly under VAT rules.
Building trust and good reputation
Showing a valid TRN builds trust with customers, suppliers and partners. It shows that the business is properly registered, follows VAT rules and takes its responsibilities seriously. This ultimately boosts its professional image.
Following the law
Businesses that are registered for VAT must include their TRN on all official documents like contracts, invoices and letters related to taxable transactions. If a business does not show a valid TRN, it can face fines and penalties from the Federal Tax Authority (FTA).
Ensuring clear and honest dealings
Having a TRN brings more openness and trust to business transactions. It helps stop tax fraud and illegal activity. By verifying TRNs, businesses make sure they are working with honest and VAT-compliant partners.
Why is verifying a TRN in the UAE so important?
Verifying a tax registration number in the UAE is important for both businesses and customers. It helps make sure that you are following VAT rules and protects you from dealing with unregistered or fake companies. Here are some main reasons why VAT number verification matters:
Protect against fraud
Checking TRNs helps prevent fraud like tax evasion, fake invoices or illegal business deals. Ensuring a TRN is real can protect your company from losing money and getting involved in legal problems.
Claim VAT on purchases
If you want to claim VAT back on business purchases, your supplier must have a valid TRN. By checking their TRN first, you make sure your business can legally recover input tax and follow VAT rules.
Avoid fines and legal trouble
If you do not validate VAT number of your suppliers or business partners, you might end up working with a non-compliant company. This can lead to penalties or fines from the Federal Tax Authority (FTA) for breaking VAT laws.
Confirming the business is legal
When you confirm VAT number, you confirm that the business is officially registered for VAT. This gives you confidence that they are operating legally and can take part in taxable transactions in the UAE.
Related: The Ultimate Guide to Applying a Tax Registration Number (TRN) in the UAE
How to check a TRN in the UAE?
You can easily verify VAT number online through the Federal Tax Authority (FTA) website. Just follow these simple steps:
Step 1: Go to the FTA website
Visit the official FTA website: https://tax.gov.ae/en/default.aspx. On the right-hand side of the page, click on the ‘TRN’ icon to start the process.
Step 2: Type in the TRN
Enter the 15-digit TRN you want to check. Make sure the number is correct to avoid any mistakes.
Step 3: Click to check VAT registration number
Once you have entered the number, click the “verify” or “submit” button. The system will check the TRN with the FTA’s database to confirm if it is valid.
How tax agents help with TRN verification
Tax agents play an important role in the UAE by helping businesses with TRN-related tasks. They make the process of getting a Tax Registration Number (TRN) quick and smooth. In addition, tax agents also help check if a TRN is valid to ensure both the seller charging VAT and the buyer paying VAT are properly registered. It helps businesses stay compliant and avoid any VAT-related issues.
Conclusion
Whether you are a business owner checking a new supplier or a customer wanting to confirm a company’s details, verifying the TRN is an important step when doing business in the UAE. Knowing how VAT works and getting the right advice can help you stay within the law and avoid problems.
Asad Abbas & Co. Chartered Accountants has strong knowledge of VAT laws in the UAE and can guide you with expert advice to help your business stay compliant. Our team of qualified professionals handles your VAT needs with care to give you peace of mind. We also ensure you claim all the VAT refunds you are eligible for, which can save your business money.
By working with us, you can be confident that your business is following VAT rules correctly. So, if you have any questions about your TRN number or VAT registration, do not hesitate to contact us for the best Value Added Tax Service in UAE! Our expert team is ready to assist you every step of the way.
