United Arab Emirates
Value Added Tax
Value added Tax was implemented in UAE from 1st January 2018. Value-Added Tax or Tax is a tax on the consumption or use of goods and services levied at the point of sale. Tax is a form of indirect tax and is used in more than 180 countries around the world.
Tax is charged at each step of the ‘supply chain’. End consumers generally bear the Tax cost while registered businesses collect and account for the tax, in a way acting as a tax collector on behalf of the Federal Tax Authority.
Only Tax registered businesses will need to charge and account for Tax.
VAT Registration Services in UAE
Any business in the UAE, that exceeds mandatory or voluntary registration thresholds, may be required or may be able to register for Tax.
The definition of business embraces most forms of activity and includes any activity conducted regularly or on an ongoing basis, e.g. industrial, commercial, professional, trade, etc.
MANDATORY REGISTRATION
- Any business in the UAE that meets the below criterion must register,
- The total value of their taxable supplies made within the UAE exceeds the mandatory registration threshold over the previous 12-month period, or
- They anticipate making taxable supplies with a value exceeding the mandatory registration threshold in the next 30 days.
- The mandatory registration threshold is AED 375,000
VOLUNTARY REGISTRATION
- Any business in the UAE that meets the below criterion MAY register (and does not fall under the Mandatory Registration threshold),
- The total value of their taxable supplies or taxable expenditure in the previous 12 months exceeds the voluntary registration threshold, or
- They anticipate that the total value of their taxable supplies or taxable expenditure will exceed the voluntary registration threshold in the next 30 days.
- The voluntary registration threshold is AED 187,500.
Vat Return Filing Services in UAE
Tax Returns Filing in UAE is done through the online portal of the Federal Tax Authority (FTA) available under e-services.
The form used for Tax return filing is called Form Tax 201. A taxable person is responsible for submitting Tax return in the UAE in the prescribed format given by the FTA. Every taxable person is required to submit the Tax Return within 28 days from the end of each Tax period prescribed by the FTA. This must be in accordance with the provisions of the UAE Tax law. The taxable person is also liable to remit the amount of tax due to the FTA within the time frame specified by the UAE Tax Law; ie within 28 days from the end of each tax period.
Our Tax professionals can support you in the following areas:
- We will visit your office on a periodical basis (weekly /monthly/ Quarterly) to compile the information for filing the Tax Return. At the end of each Tax return period, we prepare the Tax return of behalf of your company in accordance with the provisions of UAE Tax law.
- We review and verify selected sample Tax related transactions recorded by the Entity during the tax period to ensure that correct Tax amount is charged on sales as Output tax, and that Tax charged by the supplier is correctly claimed/accounted.
- We perform random review of document maintenance by the entity as per the guidelines provided by the Federal Tax Authority in United Arab Emirates to ensure that compliance is adhered with.
- We ensure that the Tax returns are filed within the specified time in each tax period.
VAT Advisory Services in UAE
Few Years back UAE government has introduced Tax in the country. Excise Tax was introduced with effect from 1st October 2017 and Value Added Tax (VAT) from 1st January 2018.
The rate of Excise tax for carbonated drinks is applicable at 50% and it 100% applicable for tobacco and energy drinks. But, at the same time the VAT rate is applicable at just a minimal rate of 5%, which is the lowest tax rate among other parts of the world.
VAT was implemented in UAE in 2018 and over the period there have been many guides, public clarifications, amendments in the VAT decree law and its executive regulations. Also, with addition of Article 79bis Statute of limitation in VAT Decree Law (which gives Federal Tax Authority (FTA) another 4 years to conduct tax audit, if same has been informed by FTA before the expiration of the 5 years from the end of relevant tax period). As we all know FTA has started sending notices/emails for conducting tax audits, we all shall keep our selves ready for Tax Audit
Premier Brains has tax experts who can assist the clients with VAT transaction advisory services in the UAE, which cover the below steps:
- Business operating model
- Business process and operations
- Place of supply
- Time of supply
- IT systems
- Compliance risk
- Specific scenario arising out of specific operational transactions
How can PB help in VAT
Our team of trained VAT consultants can help you with:
- Consulting on the taxability of the business transactions
- VAT impact assessment for your business by doing proper analysis of all tax points
- VAT review and return filing services
- VAT heath check i.e in depth review of VAT returns and business transactions
- Assistance in VAT Audit
- Correct accounting from VAT perspective
- Providing guidance on changes to be incorporated in your IT system to make it VAT compliant
- Providing training to your staff
- Advice on proper documentation and records to be maintained from VAT audit perspective
- Filing various applications with tax authority such as Registration, De-registration, reconsideration, VAT refund etc.
- Assist with obtaining clarification from tax authority for any uncertain positions
- VAT Experts & VAT Consulting Services for Your Company
Premier Brains has been providing VAT consultancy across various sectors. Our tax team has extensive experience to handle all the VAT related queries and provide appropriate VAT advice by understanding your business.
We understand that different businesses have different requirements and therefore we follow a personalized approach to ensure that our clients receive tailored consulting advice from our experienced team of tax consultants in UAE.