Value Added Tax (VAT) is a levy added on to most goods and services. It is collected from customers by vendors and paid over to the Government. Accordingly, a business enterprise will pay VAT on the goods and services it buys (on the purchase price) and collect the VAT from its customer on the goods and services it sells (on the sales price, which might also include the value for any value addition undertaken and profit on the goods before selling). The difference between the amount which the business enterprise has paid and collected is to be paid over to the government.
Standard rate of 5% will be imposed on the supply of goods and services.
Annual turnover is more than AED 375,000 in the last 12 months (a must registration)
Annual turnover/expenses are less than AED 187,500 in the last 12 months (optional)
VAT is applicable / levied in UAE from January 01, 2018 being its implementation date