Email ID :info@thevatuae.com
Call Us:050 7839 436
0097 150 4753 186
Email ID :info@thevatuae.com
Call Us:050 7839 436
0097 150 4753 186
It’s Like Having all UAE VAT Info in Your Pocket.
VAT Plus - Product Features The value-added tax (VAT), which came into effect from January 1, 2018, in UAE, is a consumption based tax which will be applicable at each stage of the 'supply chain'. That means, any UAE business making a taxable supply of goods and services will have to pay VAT on that supply. The VAT UAE is based on the same concept as followed by the other countries which use this tax system, however, the standard rate is fixed at 5% for all taxable supplies for VAT in UAE.
As per the VAT rules and regulations, some basic services (and goods) like food, public transport, and some healthcare services are exempt from the VAT, while some other services will be taxed at zero percent. You can find out more about VAT-exempt and non-exempt supplies on our blog. The VAT shall be levied at each stage of the supply chain, but there is a concept of input credit through which businesses can claim their taxes back from the government, and the ultimate VAT cost is borne by the end consumers.
VAT has been implemented in UAE with the aim to reduce the country's dependency on oil resources for revenue. It will create a new and stable source of income for the government, which will be utilized to provide better and more advanced public services. So, the ultimate benefit of VAT is to the general public.
The standard VAT rate in UAE is 5%, that means most of the taxable supplies will be taxed at 5%. However, some services are zero-rated under VAT while some others are kept free of tax. Click to review full VAT rate list
The VAT will be paid by a business (with annual turnover above Dh375,000) in UAE on any of their taxable supplies of goods and services. The tax is applicable at each stage of the supply chain. The VAT cost is ultimately borne by the end consumer when they pay the actual price (base price + VAT) at the time of purchasing a taxable product/service.
VAT was officially launched on January 1, 2018 in UAE and has been implemented on all eligible supplies across the country. The registrations for VAT started in 2017.
A farmer grows cotton which is plucked and sold to a factory
The factory processes the cotton and manufactures clothes which are sold to a retail chain
The clothes are stocked in stores and placed for sale to consumers.
A consumer buys a new dress.
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Read moreTo collect taxes and combat tax avoidance, the Federal Tax Authority (FTA) is ready to launch a tax control system in UAE for tobacco products as per the Decision No. (42) of 2018. To roll out the single integrated set, the scheme is ready to be implemented in alliance with the applicable authority, which guarantees …
The Federal Tax Authority (FTA) has granted its consent for implementing a VAT refund scheme for tourists in the UAE. The Tourist Refund Scheme which will be start in November 2018. The refund of the VAT paid by these tourists during their time in the UAE will be made available through various points of sales …
The refund of Value Added Tax (VAT), for UAE nationals who are building new residences, have been clarified with electronic procedures, announced by Khalid Ali Al Bustani, the Director- General of the Federal Federal Tax Authority (FTA) on 16th October 2018. Through a press release, the announcement was declared in which the update was given …
If the payment is not related to the supply of goods and services then the payments will not be levied with the 5 per cent VAT, clarified the Federal Tax Authority (FTA) on compensation type payments. As a part of business agreements, businesses that make payments to compensate each other for any negligence, loss or …
What is Exempt Supplies In simple words, VAT is not collected as there are some exempted goods and services informed in UAE executive regulations. This implies, VAT is not charged, on supplying these goods and services. By definition, exempt supplies are defined as ‘supply of goods or services for a consideration while conducting business in …
VAT is charged at zero rate on taxable supply and this is known as zero-rated supplies in UAE VAT. The specified goods or services which are listed under zero-rated list are charged at zero rate. It includes the nature of supply, despite the goods and services supplied. Mostly, zero-rated supplies will include all exports of …
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