Ever since value-added tax (VAT) has made its way to the UAE, businesses have been having a tough time keeping up with the various conditions put up by the Federal Tax Authority (FDA). We’ll highlight the few points that you need to keep in mind regarding VAT registrations, since businesses are required to comply with the law. There are good tax firms in Dubai who help you make this process simple too.
- If your supplies exceed 375,000 then it is compulsory for you to do a VAT registration. However, if you do not meet the voluntary registration of AED 187,000 then you aren’t required to register for VAT.
- Natural (legal) persons need to register for VAT if their supplies reach AED 375,000.
- The Tax Registration Number (TRN) is extremely important for carrying out any business transactions. In this case, the VAT registration certificate isn’t as important, the TRN will work.
- If your business is not registered with FTA, you cannot have your goods and services b taxed. These companies cannot issue tax invoices either. However, they are still expected to pay tax on any imported goods.
- FTA requires a number of documents from the businesses to help them get fully registered for VAT – like the trade license copy, the partners or the business owner’s passport copies, Emirates ID, company’s address, contact details, Memorandum of Association, bank details, income statement, business’ experience and the owner’s contact details. These are just a few documents, there could be a requirement of any other document for which you will be informed well in time.
- The mandatory threshold for VAT in the UAE is calculated basis the total business revenue generated by a business on taxable supplies over a period of 12 months. This is calculated on the value of goods & services, not on profits.
While these are some important points, there are a lot more regulations for VAT registration, and it’s important to stay in compliance with them. TRC Pamco is a VAT firm in Dubai who makes this process simpler for you!
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