Buchprufer Consultants LLP

Value Added Tax

The Federal Tax Authority of UAE was established in the United Arab Emirates in 2016 and is the government body in charge of managing, collecting, and enforcing federal taxes. Through Federal Decree-Law 13 of 2016, it was established by the President of the UAE in 2016. 

As a part of the GCC-wide push to broaden the region’s economy, taxation was implemented in the UAE. By introducing VAT and Excise taxes, the UAE will be able to diversify its revenue streams, enabling its government agencies to keep delivering first-rate public services and a high standard of living for future generations. 

What is VAT?

In the UAE, FTA implemented VAT in January 2018. Every step of the supply chain is subject to this consumption-based tax, which is paid by the final customer. Businesses are responsible for collecting and depositing this tax with the government on behalf of the FTA. Because of this, companies serve as collectors on behalf of the FTA. Businesses must adhere to the VAT regulations, and they are also responsible for making FTA VAT payments and submitting returns.

Business obligations under VAT

The intricacies of VAT compliance and business requirements are crucial for businesses to comprehend. The FTA offers a lot of advice and support to help achieve this. Nevertheless, it is the duty of businesses to see that all requisite compliance obligations are met. The FTA has the authority to conduct audits of taxpayers and then impose sanctions on those who break the law. 

 Businesses may need to make adjustments to their financial management, technological setup, core business processes, human resource management, and bookkeeping procedures in order to complete their VAT responsibilities and adhere to FTA VAT regulations. Businesses have a responsibility to charge VAT and keep track of it. 

Understanding UAE VAT

The UAE government has made a variety of tools available to businesses through its website and other channels so they may learn about UAE VAT and its regulations. Investigate every piece of information on the government website. They have added blogs, and other informational stuff to get acquainted with VAT and its laws to stay compliant and understand how and what affects your Company. You can even reach out to experts to get more info on this. It is also vital to find out whether this applies to your products or no.

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VAT Registration

Companies must primarily register for VAT if their annual revenue exceeds Dh375,000. For those enterprises that have not yet registered, there is an administrative fine of 20,000 Dh. Get your companies registered for VAT before it’s too late, or you may hire a Chartered Accountant to assist you. 

VAT provisions in Business Contracts

VAT Management and Control

Our Expertise

In order to provide its clients with top-notch bookkeeping services, Buchprufer depends on cutting-edge solutions. To provide accurate financial reporting and streamline corporate processes, the company employs a variety of software applications.

VAT in UAE

Buchprufer’s team of experienced professionals are committed to provide precise and trustworthy auditing solutions
that are crafted to match the unique requirements of your business.

Our Expertise

Saudi Arabia

Malta

Cyprus

Australia

Conclusion

It’s critical to know that a firm only pays VAT on transactions, not on income. The revenue threshold is only used to determine if a firm is eligible for VAT. Furthermore, it is also essential that your Company takes periodic assistance from a well-known VAT Automation company to ensure your business is compliant with the VAT rules and regulations.