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Overview Of VAT Services In The UAE
Value Added Tax (VAT) is a form of indirect tax. VAT has been influential in the UAE since January 1, 2018. Authorities apply VAT as a consumption tax on goods and services as their value increases incrementally at various stages through the supply chain. The end consumer will be the one who will get a real impact because of VAT. The imposition of VAT has dramatically impacted the operation of business in the UAE.
Businesses in the UAE face many adaptability challenges for handling the VAT, and they are considering the best VAT Services in Dubai. Companies in UAE will act on behalf of the government to collect VAT.
Business scenarios, such as the launch of new business lines, addition of new services/transactions, and changes in supply-chain structure, affect the applicability of VAT considerations.
VAT Rates in UAE
The different types of VAT rates in the UAE are:
- Standard rated (5% VAT)
- Zero-rated (0% VAT)
- Exempted (No VAT)
Types of taxable supplies in UAE
Standard rated supplies
As per the regulation of VAT, standard-rated supplies are those charged with a 5% tax at the time of collection.
Zero-rated VAT
Zero-rated supplies are goods and services on which a zero-rate (0%) tax is levied. Input tax can be recovered for zero-rated supplies, as exemplified below:
- International transportation and related supplies.
- Exporting of goods and services outside the UAE.
- Certain investment-grade precious metals (e.g., gold, silver, of 99% purity).
- Supplies of certain land, sea, and air transportation (such as aircraft and ships).
- Newly constructed residential properties.
Exempted VAT
Additionally, if all your supplies fall into the category of exempted supplies, you are not obligated to register for VAT. Even you cannot claim for input tax as well.
- Local passenger transport
- Bare land – sale and lease
- Residential properties – sale and lease
- Supply of certain financial services
Accounting Firm In Dubai, UAE?
Why Vat Services Are Important.
Since the UAE started charging VAT, businesses must rethink how they do business. One of the first things a company will have to do to comply with the new law is to keep its financial records in order.
Our FTA-compliant VAT Services in Dubai include the following:
- VAT registration.
- VAT return filing.
- VAT voluntary disclosure.
- VAT de-registration.
- VAT accounting.
- VAT audit.
- VAT consultancy.
- VAT Reconsideration.
How Will Overview of VAT Services Help Grow Your Business In Dubai UAE?
In general, VAT doesn’t add more work or costs to a business. Generally, every business acts as a go-between for the government when managing tax operations. The only thing that changes the cash flow is the result. So, tax collection and its performance will be more valuable for every business if there is good planning up front and good operational management. Our services for VAT will help with the following:
- To avoid making mistakes when filing a VAT return.
- Give good advice on how to avoid fees and penalties in the future.
- Keep the books of account for five years, as the law says.
- Does the tax check make sure the company hasn’t made any critical mistakes.
- Get regular information on the latest changes to the VAT law and training on how they affect the accounting function.
- Giving instructions on how to make bills for sales.
Overview Of VAT Services
Highmark VAT consultants in Dubai are not replaceable by an ordinary team of VAT consultants in UAE. We are the one-stop solution provider for overview of VAT services UAE on which your business depends. We will door for successful business in Dubai.
For all your questions or problems.
Call us at +971557309266!
How To Apply For Tax Registration Number (TRN)?
The Federal Tax Authority (FTA) has set up an online platform for businesses in UAE to apply for VAT registration and get a Tax Registration Number (TRN).
Highmark Accountants will help your business sign up for VAT online by providing the best VAT services. Making a small mistake when applying to register for VAT could result in the Federal Tax Authority (FTA) turning down your application and fining you for VAT.
Highmark accountants will make sure that your company gets its Tax Registration Number as soon as possible and without getting any VAT fines.
Why Highmark Accountants VAT Services In UAE?
- Highmark Accountants is fully capable because it has a team of skilled and experienced VAT experts who will help you by giving you the best and most reliable VAT services in Dubai.
- Our VAT experts in UAE will learn about your business and figure out how VAT will affect it.
- The accountants at Highmark will make sure that all of your business’s operations follow the rules of the Federal Tax Authority (FTA).
- Our consultants will make sure you follow all the rules for VAT, such as keeping the required VAT papers, filing your VAT returns on time, and doing many other things that will help you reach your goals.
VAT Invoice Format In UAE|FTA Tax Invoice Format In UAE
VAT Invoicing format UAE
In UAE, all companies must use the proper format for VAT invoices given by the FTA. How to make the proper tax invoice in UAE is a fundamental question that all businesses need to answer. All tax bills must include the Tax Registration Number (TRN). If the tax ticket doesn’t show the TRN, the customer shouldn’t have to pay any VAT.
Format of a VAT invoice UAE
VAT invoice format is essential for all VAT-registered companies to consider. This is a crucial source record. To avoid VAT fines and penalties in UAE, all companies must use the format for VAT invoices given by the FTA.
Any VAT-registered business that makes a taxable supply must issue an original tax ticket and give it to the person who received it. This rule applies to all supplies subject to VAT at 5%, so if you make a taxable supply, you must issue and give the receiver a tax invoice.
Format of an FTA tax invoice UAE
The FTA Tax Invoice Format UAE is something that businesses must follow. The customer and the company must have a Tax Registration Number (TRN) on a VAT document. There are two different kinds of tax bills:
- Tax bill simplified.
- A total tax bill.
Simplified tax invoice
Each line item will show the gross amount on a simplified tax invoice.
Here are the things that have to be on a simple tax invoice:
- The word “Tax statement” should be clear on the statement.
- The full name of the business, its location, and its Tax Registration Number (TRN).
- The date on the calendar when the tax bill was sent out.
- A clear description of the goods or services provided, including whether they are normal or tax-free.
- The total price and the amount of VAT charged.
It’s also essential to include the total consideration (i.e., the total gross value) with a separate line for the tax on the simplified tax statement.
Total tax invoice
Each line item on a full tax invoice will show its net worth.
The complete list of things that need to be on a total tax report is as follows:
- Include the recipient’s and seller’s full trade name, address, and TRN.
- The numbers on a statement must be unique and in order.
- Date of Supply of Goods or Services, if it’s different from the date of Tax Invoice Issue.
- The price per unit, the amount or volume provided, the tax rate, and the amount of VAT due in AED.
- The Net amount of the Invoice that is due in AED.
- Amount of VAT due in AED.
A complete tax statement must also show the total amount due in AED for the gross amount. Since a full tax statement has more than one line item, each line item must show both the net amount due (without the tax) and the VAT due.
Tax bills are written in other currencies.
These are the VAT value payable in AED and the exchange rate (based on the exchange rates published by the UAE Central Bank on the date of supply).
Rounding numbers on tax bills
Where a tax invoice is required, and the tax on the product is calculated as a fraction of a file, the value can be rounded to the nearest file using maths.
As stated above, the tax amount should be calculated for each line on a full tax invoice. In practice, this means that rounding, if it is done, should also be done for each line.
By rounding the amount using mathematical reasoning, it is meant that the tax amount on the tax invoice should be rounded to the nearest whole fils (or to two decimal places).
VAT on invoices with discounts
VAT will be added to the amount left after any discounts are taken into account. After the savings, VAT will be added to the price.
The discount can be taken off the price of the product only if the following conditions are met, which are set by the UAE VAT Executive regulations:
The customer has benefited from the lower prices, and the seller paid for the discount.
For example, the stock is 10,000 AED, and the discount is 500 AED. When the discount value is considered, the stock amount will be AED 9,500. AED 9,500 will have VAT added to it.
The top pros at Highmark accountant will take care of all your VAT concerns and advise you on dealing with the latest changes to VAT rules and regulations.
FAQs about overview of VAT services UAE
How does VAT work?
VAT filing is required on a monthly, quarterly, or annual basis by your business based on the tax period allocated to your business. The VAT return summarises the VAT received on sales and the VAT spent on purchases during any VAT period. You pay the difference to FTA if the collected amount is more significant than the VAT spent. FTA would reimburse any difference if the VAT incurred exceeded the VAT collected.
How to know the Deadline for Your VAT Payments?
Suppose you are struggling to find out the timing of your business’s VAT Return and the deadline for the VAT payments. In that case, you can check by logging into the FTA portal and knowing the due date for your VAT returns.
What is VAT Liability, and How is it Calculated?
VAT liability is the distinction between the output tax payable (Vat charged on supplies of goods and services) for a specified tax period and input tax (Vat incurred on purchases) recoverable for the same tax period.
VAT liability is calculated considering the following factors:
- Your business’s entire sales and purchases in the periodic VATreturn period.
- The amount of VAT you owe for the sales.
- The amount of VAT you can claim for the local and international purchases made.
If the output tax amount exceeds the input tax amount, the FTA must pay the difference. If the input tax exceeds the output tax, the taxable person will have the excess input recovered. He will be at liberty to set this off against subsequent payments owing to the FTA.
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