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VAT Services

Value Added Tax (VAT) was introduced in United Arab Emirates in 2018 and is applicable on all the businesses operating in the country based on the specific regulation issued.

VAT Registration

All the businesses generating sales more than AED 375,000 in a year are mandated by the law to register for tax in a timely manner.

There are various penalties imposed on the business in case they fail to register on time. Our team can conduct a free business assessment to guide you on the right time to register and ensure avoidance of any penalties

VAT Returns

Our Tax Experts can assist you process the VAT Returns on monthly or quarterly basis along with ensure maintenance of proper records as required as per the regulations.

Our teams go beyond and assist business owners in achieving tax saving to reduce the impact of VAT on their businesses

What is Value Added Tax (VAT)?

VAT is an indirect tax imposed on most goods and services and is also known as a general consumption tax. It is added to the customer's purchase price at each stage of production before the final sale. Businesses collect VAT on behalf of the government, and ultimately, it is the end consumer who pays the tax.
Why is VAT being implemented in the UAE?

The primary reason for implementing VAT in the UAE is to generate more revenue for the government to provide public services such as medical facilities, good roads, transportation facilities, public schools, parks, waste control, and more. Additionally, VAT will provide a new source of non-oil revenue for the Emirates.
How will VAT affect the cost of living?

The impact of VAT on an individual's cost of living will vary depending on their lifestyle. Overall, there will be a slight increase in the cost of living, but those who mostly spend on exempt and zero-rated items will not see much increase.
When will VAT go into effect in the UAE?

The UAE has already introduced VAT since 01 January 2018.
Will tourists have to pay VAT?

Yes, tourists will have to pay VAT. However, not all parts of the travel and tourism industry will be subject to the same VAT rates. A feasibility study of a Tourist Refund Scheme is currently underway, where visitors and tourists will be able to claim a refund on VAT paid on certain goods and services purchased in the UAE.
How does VAT work?

Businesses calculate and charge Output VAT on their sales of goods and services, and Input VAT is added to the price they pay for eligible goods or services. Businesses can deduct the amount of VAT paid from their settlement with the tax authorities.
Who needs to register for VAT?

Businesses should register for VAT if their taxable supplies and imports exceed the mandatory registration threshold of 375,000 AED. Businesses can also choose to register voluntarily if their supplies and imports are less than the mandatory registration threshold, but greater than the voluntary registration threshold of AED 187,500. Start-up businesses with no turnover can also register for VAT if their expenses exceed the voluntary registration threshold.
What are the VAT rates in the UAE?

The proposed standard rate of VAT in the UAE is up to 5%. Certain supplies of goods and services may be exempt or zero-rated, and the standard rate will be applied to all goods and services that do not fall under an exempt or zero-rated category.
What sectors are zero-rated?

Zero-rated supplies include exports of goods and services outside the GCC, international and intra-GCC transport, certain transportation means, precious metals for investment, newly constructed residential properties, certain educational and healthcare services, and some eatables. Each member state can also zero rate or VAT-exempt the educational, medical, real estate, and local transport sectors.
What sectors are VAT-exempt?

The following supplies will be exempt from VAT: certain financial services, sale of bare land, lease or sale of residential property, and local transport.
How will business owners calculate their VAT?

Businesses need to keep track of their sales, purchases, and expenses, including the tax paid on the same. The tax payable by a particular taxpayer is equal to tax collected on output (sales) minus tax paid on input (purchases).
Can businesses claim VAT incurred on expenses?

Businesses can claim VAT if they are registered under VAT, charged correctly, have proper documents showing that VAT is paid, and can claim input tax refund only on the amount paid (or intended to be paid) within six months after the supply date. End consumers cannot claim any input tax refund.

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