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Navigating the complex landscape of VAT and taxes in Dubai requires expert guidance. Our consultancy services offer tailored solutions to ensure compliance and optimize your tax strategy. From VAT advisory to tax planning, trust our experienced team to handle your tax matters efficiently.
Understanding your VAT responsibilities, registering as necessary, and paying your VAT on time are some of the most crucial factors. You risk incurring hefty fines for any interest if you need help understanding your obligations. Any unpaid VAT debt can escalate by up to 300% in interest.
You first need to know that Dubai’s VAT is 5%. It applies to all taxable supplies, including imports. Find out if you have a taxable supply, as certain services are exempt. Any exchange of products or services for money with a person doing business in Dubai is a taxable supply. All retail, culinary, and entertainment enterprises are included. Any company you’re contemplating launching would likely be considered a taxable supply.
Some services are VAT-free even if you sell them. These firms must invoice zero. Exports outside the GCC are VAT-free. GCC members are Bahrain, Kuwait, Oman, Qatar, Saudi, and the UAE. International transportation and oil and gas sales are likewise VAT-free. Supply of 99% pure investment-grade precious metals such as silver and gold. Health and education also get 0% VAT.
Newly built residential homes delivered within three years of construction will likewise be subject to 0% VAT. You might also have to pay 0% VAT if you are “outside the state.”
It would be best if you charged 5% VAT on all taxable supplies. But remember that only some businesses have to sign up for VAT. There’s a minimal requirement. For companies that must register for VAT, there is a minimum threshold. They must make AED 375,000 in taxable supplies or imports yearly. If you make taxable sales or import products worth more than AED187,500, you can register for VAT.
As a business, you will charge VAT to your consumers. However, you will be required to pay VAT on certain products and services that you purchase. VAT can be refunded. The total VAT you have collected from clients less the input tax equals your total VAT liability. The sum of money a company spends on the acquisition of inventory is known as its input tax. Taxes paid on inputs can be recovered.
In one month, a firm can acquire 10 computer tablets from another and sell 20 to a consumer. The purchase will incur 5% VAT. 5% VAT is additionally charged to the purchaser. This may double-tax the same thing. The company can recoup the VAT it paid on the first purchase. VAT is only ever billed to the end user once, to sum it up.
Our highly skilled and experienced accountants will assist you in understanding and complying with the UAE’s Value Added Tax regulations. We will examine your invoices, bids, contracts, and purchase orders to decide whether your company fits into one of two categories: required or voluntary registration.
In the past 12 months, the value of your company’s taxable goods and services exceeded the critical registration threshold (AED 375,000.00), or in the upcoming 30 days, your company anticipates that the value of all of its taxable goods and services will exceed the mandatory registration threshold (AED 375,000.00).
In the past 12 months, the value of your company’s taxable goods and services exceeded the voluntary registration threshold (AED 187,500.00), or in the upcoming 30 days, your company anticipates that the value of all of its taxable goods and services will exceed the voluntary registration threshold (AED 187,500.00).
Now that you understand everything there is to know about VAT in Dubai, you must examine all the fees associated with launching a business. Allow us to assist you in calculating the cost of starting a business so that you are prepared for everything. Use our Cost calculator to add up your numbers.
