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Middle East – VAT

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VAT Registration Guide

The UAE’s Federal Tax Authority (FTA) announced that online registration for Value-Added Tax (VAT) is now open through the Authority’s website ahead of the tax’s implementation from January 1, 2018.

VAT Timeline

31 October 2017

Businesses with an annual turnover exceeding AED 150 million should apply for registration by 31 October 2017

30 November 2017

Businesses with an annual turnover exceeding AED 10 million should apply for registration by 30 November 2017

4 December 2017

All other business entities with an annual turnover exceed the mandatory registration threshold (AED 375,000) should apply for registration by 4 December 2017

Who is required to register for VAT

AED 375,000

Mandatory registration threshold*: AED 375,000

AED 187,500

Voluntary registration threshold*: at least AED 187,500

*Threshold will be calculated as follows >>

Threshold will be calculated as follows:
– Total value of supplies made by a taxable person for the previous 12 months; or
– Total value of supplies of the subsequent 30 days
– Value of exempted supplies will not be considered for computing the annual supplies

No threshold applies to non established taxable persons – they may be required to register

Taxable supply definition >>

For the purposes of understanding whether a registration obligation exists, a taxable supply refers to a supply of goods or services made by a business in the UAE that may be taxed at a rate of either 5% or 0%. Imports are also taken into consideration for this purpose, if a supply of such goods or services would be taxable if made within the UAE.

Mandatory Registration

A business must register for VAT if the total value of its taxable supplies and imports within the UAE exceeds the mandatory registration threshold of AED 375,000, either during the previous 12 months or within the upcoming 30 days.

Voluntary Registration

A business can voluntarily register for VAT if the total value of its taxable supplies and imports within the UAE exceeds the voluntary registration threshold of AED 187,500, either during the previous 12 months or within the upcoming 30 days.
A business can also register voluntarily if its expenses exceed the voluntary registration threshold.
A business can also register voluntarily if its expenses exceed the voluntary registration threshold.

Non-resident Registration

A non-resident doing taxable business in the UAE needs to register for VAT regardless of the above-mentioned thresholds.

VAT Group - Registration

If a company has multiple entities that trade with each other, it is possible to register as a VAT group. In a group registration, all of the entities within the VAT group are treated as one entity for VAT purposes. The supplies made between members of a VAT group are disregarded (no VAT is due on them). The supplies made by the VAT group to an entity outside the VAT group are subject to normal VAT rules. When a company registers as a VAT group, it receives a single TRN and will file a single VAT return.

How to register for VAT?

Business can register through the e-Services portal on the FTA website.

Step 1

1. Open the VAT registration portal on FTA website and create a user account.
The first time you access the portal you will be required to register your details.

Step 2

2. After you create your account, an email will be sent to you to verify the details and activate your account.

Step 3

3. After the first time accessing the portal, you will simply be required to login using your user details.

Step 4

4. Once you have logged in, you will need to navigate to the VAT registration form.

Step 5

5. You will then be asked to complete the VAT registration form.

Once you have completed the application, click Submit. The FTA will process your application and respond with an email confirming your Tax Registration Number (TRN).

What are the supporting documents/details required to register under VAT

Passport and Emirates ID

Financial Statements
Turnover figures for the previous 12 months
Projected turnover figures for the future.

Contact information
Authorized Signatory documents

Bank Account details

Authorized Signatory documents

Description of the business.

Trade licence
Certificate of incorporation (if applicable)

Articles of Association/ Partnership Agreement (if applicable)

Expected values of imports and exports

Make your company comply with VAT regulations

VAT Law requirements:

Calculate VAT

You’ll be required to calculate VAT based on incoming and outgoing invoicing, import and export transactions, prepayments, returns and adjustments.

Keep other accounting operations

You’ll be required to be able to provide to Tax Authority records about balance sheet and profit and loss accounts, records of wages and salaries, records of fixed asset.

Sign, collect, process invoices

You’ll be required to sign, collect and process all your invoices in time to avoid fines from FTA0

Submit payable tax report

You’ll be required to file VAT tax reports to the government on quarterly basis

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The due date for the submission of the first VAT tax return

2018/04/27 21:59:59
Businesses within tax threshold must register for VAT!
Source: The UAE's Federal Tax Authority Website

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