How to Register for VAT in UAE

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To succeed as a business owner in the UAE, you must always ensure that you are in compliance with the laws of the land. One of the most important aspects of compliance is registering for Value Added Tax in the UAE. So, if you are at the point in your business journey where the time has come to register for VAT, this SetHub guide will walk you through the entire process!

Understanding VAT in the UAE

Before you actually begin the registration process, it is important to understand what VAT in the UAE is all about. In simple terms, VAT is a tax imposed on consumption of goods and services. At the moment, VAT rates in UAE are set at 5%. If you are a business that meets a certain criteria, then you will be required to register for VAT. You must then charge your customers the VAT, collect it and then remit that 5% to the FTA.

Is My Business Eligible to Register for VAT in UAE?

We have outlined the eligibility criteria for VAT registration in the UAE. Have a look below to understand if you will need to register for it

If the taxable turnover of your business crosses  AED 375,000 on an annual basis, then you will need to register. This category is referred to as Mandatory Registration.

In the case where your taxable turnover lies between AED 187,500 but below AED 375,000, then it is up to you to decide if you are going to register for VAT in UAE or not.

Some categories of goods and services such as healthcare or education may not be liable for VAT. In this case, it is referred to as VAT Exempt or Zero Rated.

What Documents Do I Need for VAT Registration in UAE?

Before you commence the VAT registration process, you must put together the list of documents outlined below. Having them on hand in advance will ensure that the registration process is smooth and quick. You will need:

  • A copy of your trade license
  • The Emirates ID of the business owner or managing partner
  • A document that proves the turnover of your business. This could be the audited financial statements or invoices.
  • The details of your bank accounts
  • The details of your business activities

Creating an Account on the FTA Portal

VAT registration in the UAE is done via the FTA portal. You must create an account here to start the process. The steps to follow are listed below:

You will need to visit the FTA Website and click on the sign up button. Then proceed to fill all your personal and business details. After verifying your email address, your account will be activated.

Starting the VAT Registration Process

Now that your account is setup, you must follow these steps to register for VAT in UAE:

  • Log into your account on the FTA portal and enter the VAT registration section
  • Complete the VAT registration from. You will need to include details about your business including the trade license number, business name and registered address. 
  • After this, fill in your contact details, financial particulars and details of any import or export activities.

Before you make the final submission, make sure that you have entered all the details accurately.

Uploading the Supporting Documents

You will need to ensure a series of documents that support the data entered during the application phase. Make sure that the copies are clear and legible and stick to the formatting and file size guidelines that are indicated.

Declaring Your VAT Obligations

When registering for VAT in the UAE, the FTA will need you to declare some details related to the nature of your business and what you do, whether you anticipate that you will go over the mandatory or voluntary thresholds and the particulars about business relationships you have with GCC and other entities. Be accurate, as this determines how your VAT in UAE will be calculated and reported.

Submitting Your Application

Once the form has been filled and all the documents have been uploaded, you will have one more chance to make sure everything has been entered correctly. Once this is done, click on submit and await an email to confirm the same from the FTA.

Receiving Your VAT Registration Certificate

After your registration has been approved by the FTA, the VAT registration certificate which will detail your Tax Registration Number (TRN) will be issued to you. If you want to issue VAT invoices, you will need this number. The same applies when filing VAT returns as well. 

In Conclusion,

While registering for VAT in the UAE may seem like a legal obligation and nothing else, there is a lot more to it. If you are VAT registered, this means that your business is aligned with global practices and therefore will have an effect on the relationships you have with clients. If you are VAT registered, it proves that you are compliant and transparent in your business dealings. In addition, it will portray to the UAE government that you are a foreign entity that respects the laws of the land and is here to to do good for the growth and prosperity of the UAE as a whole.

How Can SetHub Help?

Even though the UAE Government has made VAT Registration a simple process for entrepreneurs, we at SetHub understand that you may not have the time to do something so mundane. That is where we come in! We can help you with this process and take care of all compliance requirements and issue you reminders as well. 

There is a reason why we are the preferred business setup consultant in the UAE. It is because we stick with our clients from day one! We are here to take care of the paperwork so that you can focus on growing your business in the UAE, while staying VAT Compliant. So, if you feel like you could use some of our expert assistance, don’t hesitate to reach out to us. If you schedule a call now, you will hear back from one of our VAT experts in just an hour. That is our promise to you!