How to Navigate VAT Registration Services in the UAE: A Business Guide

Running a business comes with its own set of challenges, be it a small startup, a thriving medium enterprise, or a well-established corporation. Amidst these challenges, what remains crucial is getting the business registered for VAT. VAT registration is a legal requirement for businesses as it ensures that they are legally recognized by the UAE government and are fully compliant with the Emirati VAT law. However, the entire registration process can be a bit daunting, which is why businesses need VAT Registration Services UAE.

The introduction of Value Added Tax (VAT) in the United Arab Emirates has added a new layer of compliance and administrative requirements for businesses. The government has mandated the application of indirect tax on the supply of goods and services at every stage of the supply chain. This scheme was initiated to diversify government revenues and reduce dependency on oil income. Furthermore, the collected funds would help in maintaining crucial high-quality public services such as education, healthcare, and infrastructure.

Types of VAT Registration Services UAE

The VAT law in the UAE has set clear thresholds for VAT registration. This simply means, not every business is subject to VAT registration in the UAE. It saves small businesses from the burden of unnecessary documentation.

Here are the major types of VAT registration services in Dubai:-

Mandatory VAT Registration –

For businesses whose total value of taxable supplies and imports exceed AED 375,000 over the past 12 months, or is anticipated to exceed in the next 30 days. Businesses that meet this criterion are required to complete their VAT Registration in Dubai.

It is to be noted that the mandatory registration threshold does not apply to foreign businesses.

Voluntary VAT Registration –

Businesses that do not meet the mandatory threshold can still choose to register for VAT if the value of their taxable supplies and imports exceeds AED 187,500 over the past 12 months or is expected to reach this threshold in the coming 30 days.

Voluntary VAT registration can be a tricky choice if you want your business to stay ahead in the compliance process. Shuraa’s VAT registration services in Dubai can support you in this journey and make it easy to go.

Types of Supplies in the UAE VAT Law

When considering VAT Registration Services UAE, you need to understand what category of goods and services fall under taxable supplies. Currently, there are several categories of supplies charged at different rates in the UAE:-

Standard-rated supplies: Goods and services that are subject to a 5% VAT rate within the UAE.

Zero-rated supplies: Supplies that are charged with a 0% VAT, but allow businesses to claim relevant input tax. For example, certain education services, healthcare supplies, goods and services exported outside the GCC, and precious metals like gold and silver.

Exempt supplies: Supplies that do not charge any VAT and therefore, are not eligible for input tax recoveries. For example, residential properties, undeveloped lands, public transport services, life insurance, and certain financial services.

Deemed supplies: Business transactions that may be subject to VAT. For instance, selling business assets without consideration, transferring business assets between UAE and other GCC Implementing States, and goods that claimed input tax but were used for non-business purposes.

Out-of-scope supplies: Supplies that fall outside the scope of VAT law. Therefore, they are not bound by the VAT regulations set by the FTA.

Learning thoroughly about taxable supplies and understanding the VAT categories can help businesses navigate VAT obligations effectively. The VAT experts of Shuraa Tax can help you in this case and ensure that your business stays compliant while managing operational costs and financial resources proficiently.

VAT Registration in the UAE: Procedure

VAT procedures can become confusing at times, but the experts of Shuraa are always on hand to assist with VAT Registration Services UAE. Here is a simplified guide to the VAT registration procedure:

• Visit the FTA website – Start off the process by visiting the official website of the Federal Tax Authority (FTA) and create an e-Services account. Using this account, you can access the VAT registration form and manage your tax affairs electronically.
• Complete the registration form – Fill out the registration form with accurate information about your business activities, turnover, and contact details. Make sure to double-check the submitted information to avoid any delays. 
• Provide the requested documents – Gather the necessary supporting documents required by the FTA and make sure they are clear and valid.
• Receive the TRN – Once you have completed the paperwork and submitted the documents, the FTA will review your application and verify for accuracy. Upon successful verification, a Tax Registration Number (TRN) will be issued by the authorities which will be used for all VAT-related transactions in the future.
• Start issuing tax invoices – Once your business is successfully registered, you are obliged to comply with VAT regulations. Even while issuing tax invoices, make sure the TRN is clearly displayed on it. This step will help in documenting VAT transactions and facilitate smooth communication with suppliers and customers. As mandated by the FTA, keep detailed records of all VAT-related transactions and invoices to facilitate audits and compliance checks.

This entire process may seem a bit overwhelming, but there are ways to streamline it. You can simply outsource your tax and accounting tasks to a reputable agency like Shuraa Tax which will make sure your business is accommodating to the VAT laws and meets all the requirements.

Documents required for VAT registration services in Dubai:-

• Trade license
• Copies of the Passport and Emirates ID of shareholders
• Financial statements
• Bank account details
• Proof of address
• Certificate of Incorporation
• Articles of Association
• Power of Attorney
• Description of business activities
• Proof of turnover for the last 12 months (in AED)
• Proof of 12-month sales
• Estimated value of imports/exports for one year from/to all GCC countries

To avoid any delays or rejections, the business owners must ensure that the submitted documents are legal and in compliance with the FTA’s requirements.

VAT Certificate in the UAE

Once the registration process is successfully over, the Ministry of Finance issues a VAT certificate as an official confirmation that the business is registered under the VAT Law in the UAE. The certificate encompasses the following:-

• VAT Registration Number
• Date of the VAT registration
• Date of Issuance of Certificate
• Address of the Registered entity
• First VAT return period
• VAT return due date
• Start/end dates of tax periods

Non-compliance with the VAT obligations can result in significant consequences such as financial penalties, legal liabilities, and even damage to the reputation of the business. The consequences will depend on the nature of the offense.

Shuraa VAT Registration Services UAE

For over two decades, Shuraa Tax Consultants and Accountants have been playing a significant role in dealing with the accounting and taxation services for businesses in the UAE. Their seasoned tax professionals know the right procedures that need to be followed. They acknowledge the need and importance of VAT registration services UAE, and accordingly deliver a wide range of VAT services, including VAT compliance and control, VAT filing, VAT payments, VAT deregistration, and many more.

So, if you have any queries regarding VAT in the UAE or your eligibility to register for VAT, feel free to discuss them with Shuraa Tax. They would be delighted to assist you.