Taxes are a part of most economic transactions all over the world in forms of local, state or federal. However, in the UAE, only federal tax is implemented based on the differentiation of goods which are taxable, non-taxable and zero-taxable. Also, various categories of taxes are imposed depending on the type of business activities, such as selling taxable products or services, using equipment, owning a property, etc.
The two major categories of tax that most businesses would have to bear in mind are Value Added Tax (VAT) and Excise Tax (applicable only for select businesses.) VAT is a form of an indirect tax which is levied in more than 180 countries. The UAE introduced VAT in 2018. The country charges 5% VAT on goods and services. VAT in the UAE is an indirect tax applicable on the consumption of certain goods and services. The taxation started in UAE from 1 January 2018, to accumulate an economy that can uplift the progressive plans of the country. Companies must register for VAT if their total value of all supplies exceeds the given threshold.
If you already have a business in the UAE or have been planning to set up a company in Dubai or any of the other Emirate, here’s an explainer of various tax services –
- Registration of VAT in the UAE
Firms, traders and business entities having a UAE residency are required to register for VAT in case the total value of all supplies exceeds the threshold. The mandatory threshold of registering your business is AED375,000, while companies may choose to register for VAT in the UAE voluntarily if their taxable supplies are at a threshold of AED187,500. Similarly, the option to register voluntarily is designed to help start-ups with no turnover to register for VAT. There is an exemption to certain supplies and imports – to know more about the exempted supplies and imports or to learn further about VAT registration in Dubai get in touch with Shuraa Tax consultants. Shuraa Tax offers VAT registration services; helps you acquire Tax Registration Number (TRN); provides you with all the assistance with documentation required to register VAT in the UAE; VAT accounting services; and VAT filing among others.
- VAT return filing procedure
The process of filling VAT returns in Dubai could get tricky if you are not well informed about the taxation polices. To file VAT returns, you first need to log into the e-services portal on the FTA website and go to the ‘VAT’ tab and opt for company specific ‘VAT returns’ page – to initiate a new VAT return. Fill up the data in the returns section – this will include sales, expenses and all the debits/ credits within the company. Enter the net amount excluding VAT, and the net VAT amount as well. The system then calculates the tax payable or repayable. Submit the report – this is an important step as you need to check all the entries thoroughly. Seek help from a tax advisor or a tax consultant to do so. Pay the due via the ‘My Payments’ option and ensure that all the dues are paid before the allotted date to avoid any tax penalties.
- Bookkeeping Services in Dubai
UAE’s VAT implementation has encouraged companies to keep an account of their daily bookkeeping activities. Outsourcing bookkeeping services in Dubai and across the UAE is a good way to maintain your accounting system and be FTA compliant. Since bookkeeping can be an added responsibility, let Shuraa Tax Consultants share your responsibility! Shuraa Tax Consultants is one of the best bookkeeping firms in Dubai offering the best packages for VAT consultation and bookkeeping.
- Dubai tax auditing services
Companies with VAT registration in the UAE must regulate in accordance with the Federal Tax Authority. At the same time, companies must issue valid VAT invoices, maintain proper books for all the invoices and payment receipts. Also, a valid UAE VAT invoice must follow a specific format as mentioned in the legislation. These requirements must be audited as per the guidelines provided by the FTA.
If you find it difficult to deal with the legislation guidelines and your company’s finances as per the procedures put forth by the legislation go to Shuraa. They offer taxation assistance, accounting and bookkeeping services. Shuraa also provide with tax auditing services in Dubai and across the UAE. To learn about the VAT registration process, visit https://www.shuraa.com/added-services/vat-accounting