Value Added Tax - VAT

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Value Added Tax - VAT

The value-added tax (VAT), which came into effect from January 1, 2018, in UAE, is a consumption based tax which will be applicable at each stage of the ‘supply chain’. That means, any UAE business making a taxable supply of goods and services will have to pay VAT on that supply. The VAT UAE is based on the same concept as followed by the other countries which use this tax system, however, the standard rate is fixed at 5% for all taxable supplies for VAT in UAE.

As per the VAT rules and regulations, some basic services (and goods) like food, public transport, and some healthcare services are exempt from the VAT, while some other services will be taxed at zero percent. You can find out more about VAT-exempt and non-exempt supplies on our blog. The VAT shall be levied at each stage of the supply chain, but there is a concept of input credit through which businesses can claim their taxes back from the government, and the ultimate VAT cost is borne by the end consumers.

 

How Does VAT Work?

Businesses are charged VAT on goods and services they purchase (input tax). They then charge VAT on the goods and services they sell to end-customers (output tax). The difference between the input tax and output tax is paid to the government.

VAT REGISTRATION

Registration for VAT in the UAE is an online process which is accessible in the Federal Tax Authority’s online portal. Before proceeding for VAT registration, the applicant should consider various aspects such as, weather to register as voluntary option or mandatory option, weather to register as a Tax Group or a Standalone etc.

TAX AGENT

As your tax agent, we will be responsible to provide all the information, documents, records and data to the Federal Tax Authority (FTA) if requested to submit on behalf of you. We will act on behalf of you with regard to your all tax affairs with the FTA as a tax agent.

VAT RETURN FILLING

We ensure that the VAT returns are filed within the specified time in each tax period. We will visit your office on a periodical basis (weekly/monthly/Quarterly) to compile the information for filing the VAT Return. At the end of each VAT return period, VAT Return of your company will be prepared and submitted in accordance with the provisions of UAE VAT law.

VAT PENALTY

We will review the reasons of any penalty and advise on it and assist to file penalty waiver request to the Federal Tax Authority (FTA) reconsideration committee and provide all necessary support during this process.

On top of our compliance service, our team has a comprehensive understanding of all areas of tax, including

  • Support for VAT registration for your company as individuals or as tax groups

  • VAT Refund

  • Providing inputs for using VAT compliant software for your company

  • VAT Consultant Service through meetings and discussions

  • Advisory Service on call

  • Handling industry specific issues with precise guidance to comply with the UAE VAT law

  • Advisory Services with regard to Customs clearance as well as designated zone related issues

If you have any questions or would like to find out more about how we can help,

Please Contact us