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VAT Registration

VAT Registration in UAE

Introduction to VAT in UAE

The UAE has historically benefited from tax exemption, but global market pressures have necessitated the introduction of a tax system. Among various taxes, VAT has been implemented on goods transactions. Similar to sales tax, VAT is an indirect tax imposed on both goods and services throughout the supply chain, increasing the need for VAT registration in Dubai.

Importance of VAT Registration

VAT registration signifies that the business is officially recognized by the government as a supplier of goods and services, authorized to collect VAT from customers and remit it to the government. This tax also applies to imported goods and services to support local providers. While mandatory for some, other businesses opt to register voluntarily. Certain businesses are exempt from VAT and do not need additional registration to operate.

How To Register For VAT In UAE

VAT registration is mandatory for certain businesses and can be easily completed online via the Federal Tax Authority (FTA) website. Required documents for VAT registration in the UAE include:

  • Trade license copy
  • Certificate of incorporation
  • Memorandum of Association
  • Passport and Emirates ID copies of all shareholders, authorized signatories, and managers
  • Proof of turnover for the last 12 months
  • Proof of expenses for the last 12 months
  • Expected turnover in the next 30 days and related proof (contract copies if available)
  • Details of transactions with other GCC countries
  • Contact information of all authorized signatories
  • Proof of authorized signatory (e.g., MOA, POA)
  • Expected expenses in the next 30 days
  • Customs registration number with a recent bill of entry
  • Details of partners, directors, and shareholders, including their roles in other companies
  • Bank details (branch name, account number, swift code, bank IBAN number, etc.)
  • Supporting documents for customs registration in each emirate
Mandatory VAT Registration

Your business is required to register for VAT if:

  • Your sales or supplies exceed AED 375,000 in the past 12 months.
  • You anticipate that your sales or supplies will exceed AED 375,000 in the next 30 days.
  • Non-residents or businesses without a UAE residence must register for VAT if they supply goods or services in the UAE, provided no one else is paying VAT on their behalf.
Voluntary VAT Registration

Businesses that are not required to register for VAT in the UAE can choose to register voluntarily if:

  • Their sales or supplies are at least AED 187,500 in a 12-month period.
  • They expect their sales or supplies to exceed AED 187,500 (but remain below AED 375,000) in the next 30 days.
  • Their expenses exceed AED 187,500 in a 12-month period.
  • They anticipate that their expenses will exceed AED 187,500 in the next 30 days.
VAT Registration Exemption

Businesses with sales below AED 187,500 cannot register for VAT. To register voluntarily, sales must exceed AED 187,500. Additionally, if all supplies are zero-rated, companies cannot apply for VAT registration.

Seek Professional Assistance for VAT Registration in UAE

If you are uncertain about the VAT registration process in the UAE, consider seeking professional assistance. A registered accountant or tax agency can help you submit an accurate application and streamline the process. A reliable agency ensures compliance with FTA standards and can help you avoid common issues faced during registration. With their support, you can navigate the seven-step registration process accurately and efficiently..