VAT IN UAE

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.

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Percentage of VAT

Standard rate of 5% will be imposed on the supply of goods and services.

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Mandatory Registration

Annual turnover is more than AED 375,000 in the last 12 months (a must registration)

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Voluntary Registration

Annual turnover/expenses are less than AED 187,500 in the last 12 months (optional)

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Date

VAT is applicable / levied in UAE from January 01, 2018 being its implementation date

How VAT Will Work

VAT Application on Business

Standard Rated Supplies

Commercial property
Hotels
Retail Supplies
Car Rentals
Repairs

Zero-Rated Supplies

Certain Export Sales
Telecom Service Exports
Certain Transpor
International Transportation
Education
Healthcare
Medicine/Equipment
Oil/Gas
Investments Gold Silver/Platinum

Exempt Supplies

Financial Services
Local Passenger Transport
Charitable
Residential

Apply For Registration

VAT Registration Requirements

  • Email Address (For Signup)
  • Trade License
  • Certificate of Incorporation
  • Partnership Agreement
  • Articles of Association (Incase of Partnership)
  • Bank Account Maintenance Certificate
  • Audited or Managemet Financials (Prior Year)
  • Custom Registration Information (if registered with any customs department in UAE)
  • Details of Authorized Signatory
  • Proof of Authorization

Select a file to upload

Services We Offer

  • We can perform assessments of VAT’s impact on your business,
  • We can help advise you on structuring your business in the most tax-efficient manner with respect to the recovery of input VAT,
  • We can help draft sample invoices in accordance with FTA requirements for use in your business,
  • We can advise you on how to amend any contracts with suppliers / customers as appropriate,
  • We can help you implement appropriate accounting systems and tailor your record keeping to meet the requirements,
  • We can assist you with registering and filing returns,
  • We can help you with any appeals or assessments from the FTA, and correct any mistakes on your returns and apply to the FTA.

Packages

Registration only
AED 1000
One-time

Package includes:

Registration of the company with the Federal Tax Authority


6 Month Contract
AED 6000
for 6 Months

Package includes:
6 Months Contract – Taxation & VAT only

Accounting Service, from 1st Jan 2018 until June 30th 2018.

12 Month Contract
AED 16800
For 12 Months

Package includes:
12 Months Contract – Taxation & VAT only

Accounting Services from 1st Jan 2018 until Dec 31st 2018.

FAQ

  • What is VATOpen or Close

    Value added tax (VAT) is a type of tax that is applied to the goods or services produced. It is also known as a multi-stage tax. The UAE government has decided to implement this tax to have an additional source of revenue to provide a better service to the citizens of UAE.

  • Who should register for VAT?Open or Close

    As per the criteria released by the Federal Tax Authority, all businesses with taxable supplies worth more than AED 375,000 need to register for VAT.

  • Which businesses can voluntarily register for VAT?Open or Close

    All businesses with taxable supplies worth more than AED 187,500 and less than the mandatory registration threshold of AED 375,000 may opt for voluntary registration for VAT. This option is developed to give the opportunity for startup businesses to register for VAT whilst they still haven’t generated any revenue.

  • When is the VAT registration and VAT implementation date?Open or Close

    Starting on 1 January 2018, VAT will be implemented in the UAE. All businesses that are operating in the UAE are expected to be registered by then or penalties will be faced

  • What will be the VAT rates?Open or Close

    The standard VAT rate of 5% is agreed to be charged on certain goods and services in the UAE. Non-taxable goods and services will not be charged, such as health, education, and local transport, etc.

  • Does VAT Registration make non-residents reliable?Open or Close

    Non-residents or tourists will pay VAT at the point of sale. 5% VAT will be applied to perfumes, makeup, luxury bags, and big-ticket items additional of the sale price. There can be an exemption wherein there is a requirement for a certain business to use a reverse charge mechanism for the purchases from any non-resident when accounting for VAT.

  • What if I did not register my business for VAT?Open or Close

    With the Cabinet Decision No. 40’s release, the violations for non-compliance and respective penalties are all listed in its provisions. Consumers may also lose confidence in the business that does not comply with the laws of the land, hence the impending sinking of the business.

  • In the case that my business falls in all the exempted categories, what is the impact of it?Open or Close

    All businesses that have exempted supplies as goods shall not charge from their customers. VAT cannot be claimed as well on purchases made.
    However, all businesses that have partially exempted supplies as goods shall register for VAT. The VAT incurred can be claimed as well on taxable supplies.