VAT registration in Dubai, UAE
VAT or Value-added Tax is a form of indirect tax adopted and it is employed in more than 180 countries around the globe. VAT is a tax on the consumption or use of goods and services levied at the point of sale. This taxation system is widely followed in the European Union. VAT came into effect in the UAE and GCC countries in 2018. The VAT rate in the UAE and the GCC countries is 5%. It is levied by VAT-registered business entities or individuals on account of supplies of goods/services to customers in the normal course of business. VAT registration in Dubai, UAE is required for all businesses, regardless of the business domain or size. If you are an entrepreneur planning to expand your business to the Emirates or a business proprietor in the UAE, you are supposed to have a clear understanding of VAT registration in the UAE. B4B Consultancy is one of the leading VAT consultants in Dubai, UAE, which provides excellent VAT registration services across the Emirates.
How VAT WORKS IN THE UAE?
VAT is charged on business transactions involving the supply of goods and services to customers. Tax-registered businesses charge VAT by adding it to the number of goods/services they provide to their customers, whether for business or personal use. In the UAE, businesses registered for VAT have the right to reclaim VAT paid to suppliers on goods or services purchased for business purposes. The difference between VAT charged to customers and VAT charged by suppliers is reclaimed or paid to the government by the business entity. It will be implemented in almost all goods and services apart from food items, healthcare, and education. At the start tax rate is very nominal i.e. 5%
End-user is mostly affected by the implementation of tax however business setups have to make certain changes to the process and procedure to comply with the legal requirements implemented by the government. UAE business owners must register their businesses under the VAT law that came into effect on 1st January 2018. When a company registers for VAT in Dubai, it is required to file VAT returns on a regular basis or as specified by the authority. VAT registration is mandatory for companies and individuals conducting business in the UAE whose annual turnover is more than AED 375,000/-.
Eligibility for VAT registration in Dubai
For newly established companies, VAT registration is optional; however, it can become mandatory under certain circumstances. Below mentioned are the entities required to apply for VAT registration in Dubai:
- Companies selling or importing goods and services exceeding 375,000 AED per year are
required to register for this tax; - Foreign companies selling VAT-taxable goods and services in Dubai are required to
register for this tax.
VAT-registered Dubai companies will collect the tax from the final consumer and pay it to the government. A VAT return is required in order to be able to recover the amount paid as VAT. Foreign companies registered for VAT in Dubai can also claim refunds. The VAT registration process can be completed from the beginning if you want to open a company in Dubai. At B4B, our advisors will assist you with this process.
Documents Required for VAT Registration in Dubai, UAE
A tax identification number is one of the most basic requirements for applying for a VAT number in Dubai. Based on the tax identification number, a company will be issued a VAT certificate. When registering for VAT in Dubai, several documents must be prepared. These are mentioned below:
- The Company’s Business License
- Passport of the Owner and Other Shareholders
- Proof of the Registered Address of the Company in the UAE
- Information About the Corporate Bank Account (IBAN Included)
- An Income Statement for the Last 12 Months (Where Available)
- Information About the Import-Export Activities of the Company (Where Applicable)
How B4B Consultancy can Assist
B4B Consultancy has an experienced taxation team that can help you with all aspects of VAT in Dubai and other UAE emirates. The new VAT system has altered the entire business landscape. VAT differs from GST in that it is applied to a company’s entire supply chain, affecting the overall product price, cost, and procurement. It demands the overhauling of the current financial, accounting, and IT structure of any business. In this case, a perfect consultancy firm with a solid background can assist you in navigating all of these emerging issues. You can completely rely on us to resolve all VAT issues in Dubai. Feel free to contact us!
TAX SERVICES | VAT SERVICES | VAT FILE RETURN | VAT REGISTRATION IN UAE
The UAE Federal Tax Authority (FTA) has now allowed taxpayers to register for VAT purposes. Value-Added Tax services, VAT is a tax on the consumption or use of goods and services levied at the point of sale. The UAE has to implement VAT from January 2018. The rate will be 5 percent.
Following are the VAT services we provide:
| Sr. No | Services | Periodicity | Remarks |
| 1 | VAT registration & Grouping | One time | Understanding your group structure, its impact on VAT and how best to restructure if required and registering the Company. |
| 2 | Setting up of Invoices – sales and purchase (Depends on the volume of transactions) | One time |
We will coordinate with your IT team and put in place a proper document flow for VAT. |
| 3 | Accounting and cash flow impact and process | One time | We can put in place process documentation of capturing the accounting data and also proper accounting head so that it can act as a guidebook to your accounts team. |
| 4 | Accounting for client | Monthly | Depending on the volume. |
| 5 | Ensures regular updates and documents are maintained | Monthly /Quarterly |
VAT Internal audit function will be done on a monthly/quarterly basis (excludes stocktaking) |
| 6 | Training to staff /updates | One time | We will train your team if required. |
| 7 | Help in the quarterly submission of return | Quarterly | We will help in verifying all the documents and uploading the data on the Government website. |
| 8 | Act as a tax agent | When the Tax audit notice is received | This is to represent you in case there is an audit, or else these services might not be required by you. |
VAT will provide the UAE with a new source of income which will be continued to be utilised to provide high-quality public tax services and audit services. It will also help government move towards its vision of reducing dependence on oil and other hydrocarbons as a source of revenue. As one of the leading VAT consultants in Dubai, UAE, B4B Consultancy provides excellent VAT registration services across the emirates.
TAX SERVICES | VAT SERVICES | VAT FILE RETURN | VAT REGISTRATION IN UAE