VAT

VAT

Aviaan Accounting has the best team of specialists who can help you overcome all the hurdles including unfamiliarity with VAT laws and regulations, lack of resources, compliance issues, and absence of an updated accounting system. Our top-notch VAT services in UAE include:

  • VAT registration and de-registration
  • VAT audit and consultancy
  • VAT implementation
  • VAT return filing
  • VAT training and many more

Aviaan Accounting contributes to the growth of client’s business by ensuring personalized accounting practices, using advanced technology to improve compliance quality while reducing cost.We strive to provide superior, swift, and hassle-free VAT service to our clients from all sectors of the industry in Dubai, Abu Dhabi, Sharjah, UAE. You will find our VAT service process transparent and convenient as well as error-free.

VAT Consultant Services in Dubai,Sharjah, Abu Dhabi, UAE

Over the past couple of years, Dubai, has become a hub for businesses. Because of the ease with which one can set up their businesses here or can expand their business operations, owing to the political provisions and booming economy which promises high returns and profits, thousands of people, not just from the country but from all over the world have come to Dubai in order to start their own businesses.

While operating a business in Dubai turns out to be quite profitable, it is also important to remember that you need to adhere to certain rules and regulations of the government with respect to running your business, as it is with any other country. As a business owner, one of the obligations you need to fulfill is registration for VAT in Dubai.

VAT Services in Dubai, Abu Dhabi, Sharjah, UAE

It is mandatory to not consider VAT same as sales tax, although both are consumption tax but there is a significant difference among the two. VAT in Abu Dhabi is imposed on each stage of the supply chain, imports and goods/services. Sales tax is only levied on the final sale and transaction involving goods. VAT is the more sophisticated approach to taxation as it involves business to collect tax on behalf of the government and avoid any misrepresentation and tax evasion.

The Dubai Federal and Emirate governments provide public with a variety of amusements parks and recreational activities which are paid because of using government budget. With VAT government will be able to enhance the infrastructure and entertainment places for the families leading to satisfied and happy consumer. VAT in Sharjah gives government with alternative source of income and lower its dependencies on oil and hydrocarbon, resulting into strong economy.

hjdfsdh 323k 131 - VAT

VAT services in Abu Dhabi, Dubai, Sharjah, UAE

VAT or Value Added Tax is a consumption tax that is charged by different countries in the world, especially in Europe, and in 2018, the Dubai government too decided to begin implementing VAT at a rate of 5%. This consumption tax becomes an indirect source of revenue for the government and is collected by companies on its behalf. It is charged after every sale in the supply chain; any company that manufactures a product must charge VAT in Dubai, UAE at each value addition stage till the final stage. Moreover, not only are companies registered under the VAT norm meant to charge 5% VAT on their products, whenever they buy goods from other companies or suppliers, they too need to pay VAT. It is the difference between the above two amounts that need to pay to the government authorities.

The following are ways in which the new VAT services in Dubai can affect your business:

  • You will be required to properly document your business income, costs as well as your VAT in Abu Dhabi, UAE associated charges.
  • All registered businesses, as well as traders in Dubai (and the Dubai), shall be required to charge VAT to all their customers at the existing rate, which is 5% and shall have to pay VAT on any goods that they purchase. The difference between the two is what must be paid to the government agencies.

VAT Registration Services Dubai, Abu Dhabi, Sharjah, UAE

Maintaining and updating all financial records, transactions and business accounts is essential for every corporate entity. If a business fulfils the criteria of minimum annual turnover, then it should get itself register for VAT in Abu Dhabi. By getting registered means that company can charge VAT in Dubai, UAE to its customers and remit the same to the Government. Registered businesses are admissible to do the following:

  • Charge VAT on taxable supply of goods and services
  • Claim Input Tax Credit on VAT paid on their purchases
  • Payment of VAT to the government
  • Filing of VAT return as per VAT Law Dubai

It is advisable to get prepared for the information required during the process of VAT registration in Abu Dhabi, UAE before creating an e-service account. Most important include details of the business, contact/banking information, business partnership, and declaration.

VAT Verification Services Dubai, Abu Dhabi, UAE - TRN Number

The Tax Registration Number is issued after registering for VAT in Abu Dhabi. It is a unique 15-digit number which differentiates a company from others. VAT verification gives company a strong position among its internal and external stakeholders and increase its credibility in a way that the company is not involved in tax evasion practices. Moreover, TRN facilitate in preparing tax invoice during a transaction, claiming tax refund, and filing VAT return in Dubai, UAE.

What are Goods and services under VAT Dubai, Abu Dhabi, Sharjah, UAE

According to Executive Regulations and Federal Decree, goods are any form of property that can be supplied. It includes real estate, energy, and water as well. By services, VAT Law in Dubai, UAE means anything other than goods than can be supplied are services.

VAT Refund in Dubai, Abu Dhabi, Sharjah, UAE

Under VAT Law in Dubai, a company can claim VAT refunds in Abu Dhabi, UAE in case of many circumstances, be it a special scheme or a taxable person in a net taxable refundable position, it includes:

  • VAT refunds Dubai for foreign businesses.
  • VAT refund Dubai for tourists.
  • VAT refund for Dubai nationals building new residences.
  • VAT refunds for Foreign Governments, International Organizations & Diplomatic Bodies.

Guidelines on Filing VAT Return in Dubai, Sharjah, Abu Dhabi, UAE

VAT Filing in Dubai, UAE is done through an online portal provided by Federal Tax Authority (FTA). All businesses need to provide the information regarding sales, purchases, output and input VAT in the designated areas of VAT return form available on the portal. The form is known as VAT 201, it has different categories which a tax payer needs to fill in order to complete the process of VAT filing in Dubai, UAE. The sections in the form includes:

  • Taxable Person Details
  • VAT Return Period
  • VAT on sales and all other outputs
  • VAT on expenses and all other inputs
  • Net VAT Due
  • Additional reporting requirements
  • Declaration and Authorized Signatory

Why Choose Aviaan Accounting for VAT Services in Abu Dhabi?

VAT is a relatively new concept in Dubai, and many businesses are yet not clear about the regulations concerning the same. However, in order to not get a penalty, it is important to adhere to the VAT norms in Dubai, UAE, which is where Aviaan Accounting can help you because we have experienced tax experts that would help you with your tax assessments and would also ensure that you comply with all the VAT norms. Our tax consultants have a lot of experience with regards to VAT Consultants in Dubai, UAE, would make no errors when calculating taxes, and would ensure that your company stays clean, and would also offer valuable tax-related insight. Here are some benefits of hiring Aviaan Accounting for your VAT requirements:

  • Efficient Reviews and Analysis: At Aviaan Accounting, we ensure that all your business contracts and your client business documents are thoroughly reviewed and analyzed so that taxation is prepared properly; and will be no errors and omissions and so that VAT reports in Abu Dhabi, UAE can be filed smoothly and on time.
  • Training and Resources: We ensure that you and your employees are well informed about the VAT taxation norms and understand the whole process of VAT filing in Dubai, UAE. Moreover, we also make sure that you have access to the necessary resources and technology so as to be able to meet your company’s VAT preparation and taxation needs.
  • VAT Compliance and Filing:At Aviaan Accounting, we not only  clear your doubts or queries with regards to anything VAT but also help you adhere to VAT norms in Sharjah and with the VAT filing process in Abu Dhabi, UAE.

Update on Aviaan Accounting VAT Implementation Process in Dubai, Abu Dhabi, Sharjah, UAE

We make sure to maintain a high-end quality accounting system so as to be able to provide the best VAT services to you. Here are some of the services in Abu Dhabi, UAE we offer:

  • Assist in VAT registration by employing the best VAT consultants in Abu Dhabi, UAE.
  • Analyze as well as find out how VAT deployment impacts your business.
  • Analyze accounting necessities and IT systems for clients in Dubai.
  • Top VAT consultants in Dubai, UAE deal with VAT filing and assessment of VAT returns
  • Assist in processing and claiming VAT refunds in Dubai, UAE.

Aviaan Accounting VAT Services in Dubai, Abu Dhabi, Sharjah, UAE 2021

The following are the types of VAT services in Dubai, UAE we offer at Aviaan Accounting:

  • VAT Consultancy: Our top tax consultants in Dubai, UAE will help you with VAT registration and with maintaining a record of your tax invoices so you can avoid any penalties.
  • VAT Agent Appointment: You can fix an appointment with our top VAT agents in Dubai, UAEwho have experience in handling VAT is not just Dubai but also Asia and Europe.
  • VAT Deployment: Since we have a lot of experience working with VAT in different countries, we can help you with moving to the tax process transition.
  • VAT Compliance:To make sure that you file your VAT on time, our VAT consultants in Dubai, UAE will help you find all the applicable compliance requirements according to Dubai VAT norms.
  • VAT Filing: Our VAT consultants will help you record and file client invoices the right way, and at the right time, so you don’t get a penalty.
  • VAT Registration:By hiring Aviaan Accounting, you would stay clear on the documentation end as we would take care of the online VAT registration in Dubai, UAE with the concerned authorities.
  • VAT Readiness Assessment: So that your business is ready for VAT application, we offer a free VAT readiness assessment.

Impact of VAT in Dubai, Abu Dhabi, Sharjah, UAE on different Sectors

Services

VAT Impact

Digital Marketing Services

All Service including Search Engine Optimization, Search Engine Marketing, E-mail Marketing and Other Social Media Marketing are subject to 5%VAT
 

Transportation Services
 

All domestic and international transportation is exempted from VAT or zero rated except public transport for commercial purpose and tourist that will be charged 5% VAT
 

Financial Options
 

Options under the context of debt or equity security are qualified as a financial service exempted from VAT.
 

Healthcare Services
 

Healthcare is categorized as zero-rated except for the medicines and medical equipment not listed in Cabinet Decision which will be charged 5% VAT
 

Sale of Business
 

Sale or transfer of business completely or an independent part as a going concern is exempt under the UAE VAT Regime.
 

Telecommunication & Electronic Services
 

Telecommunication and electronic services will be charged at 5% VAT in Dubai. However, the export of telecommunications services shall be zero-rated.
 

Financial Services and Islamic Finance Products
 

Supply of financial services and Islamic finance products will be treated as zero-rated. The rest of the financial services shall be charged at the rate of 5% VAT under Dubai VAT Law.
 

Real-Estate Services
 

Residential properties are exempted from VAT payments during the lease or sale of the property.
 

Education Services
 

All educational services are zero-rated by Dubai VAT Law.

What are VAT Penalties in Dubai?

Penalties and fines are an unwanted burden for your business. The general penalties under VAT in UAE are the following. Failure to keep proper records and information leads to a penalty of AED 10,000, whereas it is AED 50,000 the second time. Failure to submit accounts when demanded by the authority, register within the timeframe, and designate a legal representative leads to a penalty of  AED 20,000. Failure to inform the FTA in UAE after any amendment leads to a penalty of AED 5,000, whereas it is AED 15,000 the second time.

What is VAT Audit in Dubai?

All business entities should make their business ready for VAT audit in Dubai. VAT audit in UAE must follow a checklist before commencing audit. Documents required for VAT Audit in UAE are Records of all supplies and Imports of Goods and Services, Tax Invoices, Tax Credit Notes, exported Goods and Services, adjustments or corrections, Customs declarations, and fixed asset or capital asset purchased. The VAT audit procedure is reviewing the financial records and returns, performing them during official working hours, and reporting violations.

How does VAT in Dubai aid in Business Growth?

VAT was introduced in the UAE on the 1st of January 2018 to expand the source of revenue for the advantage of the citizens. VAT implementation in UAE has its benefits for the current business growth. VAT in UAE will aid by better infrastructure with contributions to the public infrastructure, higher business efficiency with a systematic approach to business, improved liability management and check of cash flow, and boost to the government with a more stable economy.

What are VAT Designated Zones in Dubai?

Designated Zones in UAE recognized by the Dubai Cabinet eligible for special treatment under the UAE VAT law. A Designated Zone must be a distinct fenced area. The zone should meet the following terms like adhering to stringent control criteria, maintaining detailed accounts of goods supplied, implementing security and customs systems, following internal procedures, and adhering to the processes set out by the FTA. If a Designated Zone in Dubai transforms the way it operates, then it will be considered a part of Dubai for VAT purposes.

What is Related Parties under VAT law in Dubai?

Related parties for VAT in Dubai are two or more people who are not separate on the economic, financial, or regulatory level. One can control the others either by law or through the purchase of shares or voting rights. Economic practices include either completing a common commercial objective, business profiting both parties, or supply to the same customers. Financial level including either financial support, dependency on another person’s business, or mutual interest in the proceeds. Regulatory practices including either the same management, employees, or shareholders.

What is VAT Profit Margin Scheme in Dubai?

The profit Margin scheme in UAE is where a registered person calculates and charges tax based on the profit margin scheme. The taxable person may calculate tax using the profit margin in the following situations that are goods purchased from a person who is not registered and a taxable person who calculated the tax using the profit margin scheme in UAE.  It also includes the supply of goods for which no recovery of input tax. The goods subject to the profit margin scheme are second-hand tangible movable goods, antiques over 50 years old, and collector items.

What is VAT Reverse Charge Mechanism in Dubai?

The reverse charge mechanism in UAE is under which the recipient of goods or services has to pay VAT instead of the supplier. It applies to a taxable person importing goods or services for business or a registered person who makes a taxable supply in the UAE to another registered person of specified goods with applicable rules. The reverse charge under VAT law in Dubai is not applicable when the final destination of imported goods is another implementing state or when supply is taxable at 0%.

What are duties and eligibility for Tax Agent in Dubai?

A tax agent in UAE is a person registered with the FTA. Tax Agents hired by a Taxable Person to represent and assist them in fulfilling tax obligations. The duties of a Tax Agent are to assist clients, maintain the confidentiality of information, refuse to participate in any work resulting in the breach of the law and provide all information requested by FTA. FTA specifies eligibility criteria for Tax Agents. Tax Agents in UAE have to mandatorily register with the FTA and obtain a Tax Agent license.

If you have any queries related to VAT norms in Dubai or with regards to our services, get in touch with us. Our experts can certainly help you with the requirements. Contact us now at info@aviaanaccounting.com or +971567952590

VAT Service FAQs

Yes, the deadlines for VAT Return filing and payment are in the Tax Registration Certificate, and these are either monthly or quarterly based upon the conditions by FTA. The due date for VAT Return and tax payment is the 28th day after the tax period closing (monthly or quarterly). There are no different dates for Return and payment.

The methods available to make the payment to the FTA are:

  • Online Bank Transfer
  • Payment to a Bank Teller
  • E-Dirham Card
  • Credit Card

Yes, books of accounts maintained for VAT by all registered persons for a period ranging from 5-15 years.

Yes, input VAT incurred in UAE is eligible to claim and adjust against the output VAT, except on those specific cases announced by FTA. Most of the input VAT is eligible to claim if it is not personal but business-related.

Failure to register is an offense leading to a penalty charged by FTA. FTA issues Tax numbers on all registration applications unless the application is not complete or wrong information is uploaded, or FTA requires some amendments or additional information.

The other consequence of non-registration, business owners cannot claim any input VAT incurred, and eventually, the cost of operations will go up. The person needs to pay all the tax amount due on the supplies during such delay in registration.

No, non-registered persons cannot claim any input VAT as only the registered persons are eligible to charge VAT. Most of the individuals in supplies are the end-user, not needed to register for VAT.

FTA has announced a list of Designated zones in UAE, and only those shall follow special provisions as published by FTA. The designated zone has special treatment for the supply of goods treated as out of scope, and no VAT is applicable. Services supplied by free zone companies are in the same line as mainland companies taxed at 5% unless exempt or zero-rated.

Since it is just wrongly reported, there is no short report and short payment of tax. The error is adjusted in the next due tax return.

Referance

  1. Federal Tax Authority – https://www.tax.gov.ae/
  2. UAE Ministry of Finance – https://www.mof.gov.ae/en/Pages/default.aspx
  3. International VAT Association – http://www.vatassociation.org/

We focus on advice consulting business financials Get A Quote