In the UAE in 2018, the value-added tax (VAT) was introduced to diversify the country’s revenue sources. If your business operates in the UAE, it is essential to understand VAT registration requirements and comply with the relevant regulations to avoid penalties.
This VAT registration user guide provides a clear overview of who should register, helps prepare the document, meets industry-specific requirements, and can help avoid general mistakes for a smooth registration process.
Businesses in the UAE must assess whether they meet the VAT registration threshold to determine whether registration is mandatory or voluntary.
Mandatory Registration: Businesses with a taxable supply and import will have to register for more than 375,000 annual VATs.
Voluntary Registration: AED can opt for more than 187,500 taxable supplies and business voluntary registration.
In both cases, companies should ensure that their financial records and business activity details for VAT registration are accurate and updated.
Mandatory: If your turnover is higher than the legal limit, non-compliance may result in heavy fines.
Voluntary: voluntary registration allows businesses to reclaim VAT on business-related procurement, improves cash flows and reliability with suppliers and customers.
Below mentioned are the documents required for VAT registration in Dubai:
Ensure that your VAT registration certificate includes the right legal name and business license number to avoid rejection or delay.
Import/Export Business: Customs registration is mandatory with Dubai customs or other local authorities.
Freelancer or Advisor: Their application needs to clearly define their business activity and income.
Construction and Real Estate Companies: Contracts copies and project details should be provided as part of issuing VAT tax registration numbers.
It is best to consult a VAT specialist for sector-specific guidance.
VAT registration in UAE does not require a stressful process. Our experts of Unicorn Global Solutions can help you compile documents, complete the application and approve your VAT registration certificate without delay.
To start, contact us today and make sure your business remains VAT-compliant!
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Value Added Tax (VAT) is a consumption tax applied to goods and services at each stage of production and distribution. It was introduced in the UAE on January 1, 2018 as part of the government’s efforts to diversify revenue sources.
The standard VAT rate in the UAE is 5%, applied to most goods and services. Some categories qualify for zero-rating (0%) or exemptions.
Taxable supplies include the sale of goods and services, imports, and certain transactions between businesses. These can be at the standard rate (5%) or zero-rated, depending on the nature of the goods or services.
Most businesses are required to file VAT returns quarterly (every three months). Some larger businesses may need to file monthly, as determined by the Federal Tax Authority (FTA).
Yes. Businesses registered for VAT can claim a refund (input VAT) on eligible expenses related to taxable supplies, provided they have valid tax invoices and meet FTA requirements.
Penalties can include monetary fines for late registration, late filing, incorrect returns, and failure to maintain proper records. These fines can range from AED 500 to AED 50,000 or more, depending on the violation.
