Value Added Tax (VAT) is a tax applied at each point of sale on the purchase of goods and services. The end customer is answerable for the cost. Organizations are required to gather the tax as per the schedule. VAT is applied similarly to all tax-registered enterprises operating in free zones and the UAE mainland.
VAT is a tax applied at each point of sale on the expenditure. The end consumer will ultimately face the burden of the cost. Companies are required to collect and organize government-aid taxes. VAT is not an additional cost for the company. In general every industry act as a negotiator for the government. Proper Planning is helpful to manage and execute the plan to get high profits.
VAT is not an additional burden or cost for the business. In general, every business act as a mediator for the Government. Only the effect is reflected in the cash flow. So, proper planning and effective management of tax collection and its execution will give added value and cash inflows to every business.
To register for VAT in UAE, you need to sign up an e-service account by logging into https://eservices.tax.gov.ae and provide the details as required. Then, log in to your account and start the VAT registration on clicking ‘Registration for VAT’ on the dashboard.
If the ‘Non-residents’ make taxable supplies in UAE, they are required to register for VAT, provided there is no UAE resident responsible for VAT accounting on these supplies. Non-residents can register for VAT in UAE with the help of a tax consultant.
No. A registered taxable person will issue a Tax Invoice as defined by FTA. There are two kinds of invoices: Simplified Tax Invoice specifically for supermarkets as well as retail industries and detailed Tax Invoice.
Once the claim for refund is submitted, FTA will review the application within 20 business days and notify the applicant (taxable person) via email, the acceptance or rejection of the submitted claim. Once your claim is approved, the refund will be made within 5 business days.
Yes, they can claim subject to Vat Law. There are various VAT refund schemes benefitting and supporting the UAE Nationals, even for those who are unregistered. This scheme is available to those constructing new residences in UAE solely for the use by the owner and family.
Yes. The tax paid on the import of goods is eligible for input tax recovery. This can claim back through the Reverse Charge Mechanism.
Yes. Fuel expenses specifically for business purposes can be claimed.
The VAT exempted supplies in Dubai includes financial services including life insurance and reinsurance of life insurance; financial services that are not conducted for an explicit fee, discount, commission, rebate or similar type of consideration; residential buildings other than the residential buildings which are specifically zero-rated; bare land and local passenger transport.
No. Businesses supplying exempted goods or services are not allowed to claim input tax paid on purchases. The input tax paid would be considered as a cost to the company.
The businesses are liable to charge the tax to the customers based on the output and input tax.
Output tax is the VAT collected on selling goods or providing services to the clients. Input tax is the VAT paid on purchasing raw materials for the goods or services.
Hence, the formula for VAT assessment is:
VAT = Output Tax – Input Tax
VAT compliance brings goodwill to the business.
The business picture gets highlighted once registered under VAT law.
VAT is easier to administer when compared to any other indirect tax.
The entire sales and purchases of your business in the germane return period
The amount of VAT you owe for sales
The amount of VAT you are able to claim for the purchases made
Any Questions? Call us
Any Questions? Email us
BAK Accounting and Auditing Service is a professional firm in U.A.E where we are providing quality audit and accounting services for the entire UAE business industries.