1. What is VAT?

• Overview: Value Added Tax (VAT) is a consumption tax levied on goods and services in the UAE. Businesses collect VAT from customers on behalf of the government, which is then remitted to the Federal Tax Authority (FTA).
• Importance: Understanding VAT is essential for compliance, avoiding penalties, and maintaining a good standing with the FTA.

2. Who Needs to Register for VAT?

• Mandatory Registration: Businesses with taxable supplies and imports exceeding AED 375,000 in the previous 12 months are required to register for VAT.
• Voluntary Registration: Businesses with taxable supplies and imports between AED 187,500 and AED 375,000 can opt for voluntary registration to reclaim VAT on business expenses.

3. VAT Registration Process

• Consultation: Our experts will assess your business’s eligibility and guide you through the registration process.
• Documentation: We assist in preparing and submitting all necessary documents, including:
  • Trade license
  • Passport copies of owners/partners
  • Financial records
• FTA Submission: We submit your application to the FTA and monitor its progress.

4. Benefits of VAT Registration

• Compliance: Avoid penalties and fines by ensuring your business meets all VAT regulations.
• Reclaim Input VAT: Registered businesses can reclaim VAT on eligible business expenses, reducing overall costs.
• Enhanced Credibility: Being VAT registered can enhance your business’s reputation and credibility with clients and suppliers.

5. Threshold Limits for VAT Registration

• Mandatory Registration Threshold:
  • Businesses with taxable turnover exceeding AED 375,000 in the past 12 months must register for VAT.
• Voluntary Registration Threshold:
  • Businesses with taxable turnover between AED 187,500 and AED 375,000 can register voluntarily, allowing them to reclaim VAT on business purchases.
• Exemptions: Certain businesses with supplies that fall under the zero-rated or exempt categories may have different registration requirements.