News from Panis

Mention a retention of title clause on your invoice

With a retention of title clause it is contractually stipulated that ownership does not transfer from seller to buyer until the purchase price has been paid in full. Thus, the buyer will acquire ownership of goods when he made a payment in full.

A seller who mentions a retention of title clause on his invoice, has the right to recover his goods if the buyer fails to pay the price in full. The only condition is that the retention of title clause is stipulated in writing (or mentioned on the invoice) no later than the time of delivery of the goods.

Limitation on the deduction of interests

As from the 1st of January 2019 a company can only deduct net interest costs up to the highest of the 2 following thresholds: 3 million EUR, or, 30% of the earnings before interests, taxes, depreciations and amortizations (EBITDA). Net interest costs refer to the positive difference between paid - and received interests.

In case of Belgian group companies, the 3 million EUR threshold, the 30% EBITDA threshold and the net interest costs have to be calculated on consolidated basis.

Penalty for non-declaration of foreign bank accounts and life insurances

As a result of the international exchange of information, the tax authorities can trace more easily tax payers who did not declare foreign bank accounts and/or foreign life insurances.

People who did not declare their foreign bank accounts and/or foreign life insurances, may face a penalty of 50 EUR.

The foreign income will be taxed according to the applicable tax regime and, on top of this, a tax increase will be applied.

The tax authorities may also use the gathered information for further investigation.

Federal Tax Authority in UAE clarifies VAT on gold, diamond deals in UAE

The Federal Tax Authority (FTA) in UAE on Wednesday clarified that the new Cabinet decision issued about VAT reverse charge mechanism for the gold and diamond industry will only pertain to commercial transactions between registered dealers.

The General Data Protection Regulation (GDPR)

The General Data Protection Regulation (GDPR) is due to come into force in all EU member states on 25 May.

The GDPR is created to regulate how businesses should take care of personal data. It applies to small and medium-sized enterprises (SMEs) as well as to large corporations.

Data controllers must make clear how they collect people's information, what purposes they use it for, and the ways in which they process the personal data. Companies must also use plain language to convey these things clearly and coherently to people.

Proposed changes in the VAT implementation mechanism for the gold & jewellery sector in Dubai

According to the Dubai Gold & Jewellery Group they have been informed by DMCC that the sector may receive the below mentioned special considerations for VAT and these changes in the implementation could be in effect in a few months’ time:

Key changes of the corporate income tax reform

For taxable periods starting on 1 January 2018 or after, several new measures with respect to corporate income tax are effective. The new measures are part of the law on corporate income tax reform of 25 December 2017.

Panis highlights the most important changes.

Withholding tax on paid-up capital reimbursements

As from 2018 onwards a reimbursement of paid-up capital will become proportionally taxable as a dividend distribution, in case the company has a balance in retained earnings.

A reduction of capital will be considered to be pro rata a reduction of capital and pro rata a distribution of retained earnings. On the distribution of retained earnings, a dividend withholding tax of 30% will be due – if no exemptions or reductions are applicable.

Dubai VAT registration is now open

The UAE Federal Tax Authority (FTA) announces that online registration for VAT is now open.

  • All businesses with a turnover exceeding AED 150m should apply for registration before 31 October 2017.
  • All businesses with a turnover exceeding AED 10m should apply for registration before 30 November 2017.
  • All businesses that must be registered by 1 January 2018 should submit their registration applications before 4 December 2017 to minimize the risk of not being registered in time for the beginning of the new year.

A business must register if:

Advance tax payments encouraged

The interest rate to calculate the penalty for insufficient prepayments will increase from 1% to 3%, leading to an average tax increase of 6,75% from income year 2018 (tax assessment year 2019) onwards. For such reason Panis strongly recommends you to make advance tax payments.