Do You Need to Pay VAT? To Know Check out Here

On 1^st January, 2018, UAE government introduced Value Added Tax (VAT). The introduction of new tax has made a buzz among UAE residents. People are curious to know how this would impact their budget, which businessmen are eligible to register for it, what requirements need to be fulfilled, how to register and several other questions. To deal with all questions and clear all the doubts, there are several consultancies and companies in Dubai which offer VAT Consultation. To have a general understanding about VAT and criteria for registering it, some guide points are provided here. So keep reading on and know about it more.

What is VAT?

VAT is an acronym for Value Added Tax. It is a tax on consumption or use of goods and services levied at every stage (from production to sale). It is an indirect form of tax bore by end customer and collected by businessmen on the behalf of government. It is imposed with the intention of making new source of income for government in order to provide high quality public services and reducing its dependence on oil for revenue collection.

How does VAT affect individuals and businessmen?

For individuals: VAT is applicable to almost all transactions made for goods and services. This will comparatively raise the cost of living and the effect will vary according to the individual’s lifestyle and expenditure. The residents, who use mainly those products and services which are exempt from this or have 0% rate, will be least affected by this tax.

For businessmen: All businessmen have to carefully maintain required documents regarding their income, costs and respective tax charges. Registered businessmen need to collect VAT from all customers according to guidelines and need to pay VAT for the goods and services (they have bought and used) to their suppliers. The difference in amount will be reclaimed by the government.

Criteria to Register for VAT

• According to guidelines, any business receiving yearly turnover of at least AED 375,000 must be registered under VAT. It is mandatory to prepare and file VAT returns and maintain documentation of tax returns for at least 5 years.
• Those businesses also need to register which anticipate that their total value of supplies will exceed the threshold of AED 375,000 in next 30 days.
• However, registering for this tax is optional for businessmen who receive turnover of at least AED 187,500 per annum.
• The businesses which do not have a residence place in UAE have to register under VAT irrespective of the threshold on a mandatory basis.
• The businesses with value of supplies below than AED 187,500 are not allowed to register under this tax.

This little guide about VAT is sufficient to make yourself clear who are allowed to register under VAT and who are not and how is it affecting people’s lives. However, there are many aspects to know in detail about VAT. For that, VAT consultation from professionals is the best solution, as consultants have complete knowledge and are well versed in the whole process.

Locate the Appropriate and Best VAT Consulting Services in UAE

In legal strategies, understanding the necessities of legal services and having an accomplished legal counselor has turned out to be a standout amongst the most critical choices. The legitimate framework in India is diverse and makes it complex for a typical man to take appropriate choices without the assistance of a specialist.

Choosing VAT Consultancy Services UAE is regularly a troublesome assignment. Organizations in UAE have different legal counselors according to their subject of specialization. Attorneys in UAE can bolster you in different legal issues. Law offices always give arrangements on confounded legitimate issues.

Their competency lies in the extraordinary execution of their partner legal advisors. UAE attorneys have inside and out learned of laws and give legitimate answers for particular issues of customers according to as far as anyone is concerned, involvement and capacities in use of the law.

VAT expert in UAE are simply not constrained to exhort the clients but rather likewise does utilization of most recent VAT laws and standards to help the customers. They help such that the two prerequisites as for charge laws and hierarchical objectives are met in the most productive and viable way.

Bookkeeping is presumably a standout amongst the most loved subjects to study and employment segments to work in. Bookkeeping segment has given a lot of openings for work to individuals over the previous decade.

Bookkeeping firms in UAE have dependably been at the front line of helping individuals as far as their tax assessment issues and monetary liabilities. These organizations likewise track, sort out and refresh your monetary obligations, for example, installment of your duty.

VAT Consultancy Services UAE likewise has a reputation of positive audits and has essential involvement in the concerned areas. These organizations have proficient representatives which are the fundamental mainstays of the organization and without them, the firm can’t work legitimately.

Bookkeeping firms enlist representatives having ability regarding the matter and know-how to manage such things. VAT advisor in UAE has the aptitude for understanding your business needs to perceive the worldwide VAT issues and deals with these in a flourishing and functional way.

The VAT advisors in UAE gives consultancy which has different advantages, for example, prompt cost investment funds and ROI, the straightforwardness of VAT chance regions, VAT hazard service and functional approach adapted to boost the VAT reserve funds.

UAE Lawyers have work in relationship with different famous firms and eminent legal counselors on changed ventures and have additionally effectively done the legitimate procedure service services.

UAE has turned into a center point for bookkeeping firms and individuals originate from the whole way across the nation to deal with their legitimate issues.

VAT advisor in UAE has the ability in understanding your business needs to perceive the universal VAT issues and deals with these in a flourishing and down to earth way.

The VAT specialists in UAE gives consultancy which has differing advantages, for example, prompt cost investment funds and ROI, the straightforwardness of VAT hazard zones, VAT chance service and down to earth approach equipped to augment the VAT reserve funds.

UAE Lawyers have work in relationship with different eminent firms and famous legal counselors on shifted extend and have likewise effectively completed the legitimate procedure service services.

Here’s All You Should Know about VAT in UAE and Its Accounting

Not everyone in this world knows all about value-added taxation and its accounting, but it can be regressive if you remain unknown about it if you are a taxpayer especially a VAT payer. The more knowledge you get about it the more beneficial it is for you. In this blog, I have concluded some of the major facts and essential things which you should know about value added tax and its accounting.

VAT registration criteria: If you own a business and your revenue on supplies and imports is greater than AED 375,000 per year, then you are strictly supposed to file VAT. If your revenue on imports and supplies is greater than AED 187,500 per year then it is your choice to file VAT or not. The collection of tax from customers should be paid to the government however at the same time the government will refund the tax to the business which they have paid to the suppliers.

The business owners which come under the condition of paying VAT are subjected to create an account and register themselves on the official website of Federal Tax Authority through the section – e-services. However, as the business- owners tend to be busy with so many procedures, meetings, and operations, it is advised to appoint one of the best Dubai VAT Consultants who would be reliable and capable of taking care of your VAT accounting.

VAT is commonly applied to all the businesses that are tax-registered and managed on the mainland and free zones of UAE. It is totally tax-free if the transfer of goods is operated between the decided designated zones. All the taxable people and business which are VAT registered must submit a VAT return at the end of every tax period to FTA (Federal Tax Authority).

The difference between the input tax (VAT incurred on purchases) recoverable for a given tax period and the output tax payable (VAT charged on supplies of goods and services) for the same tax period defines the VAT liability. When the output tax amount exceeds over the input tax, the difference should be paid to FTA and in case the input tax exceeds the amount of output tax, the excess input tax will be recovered.

 It is mandatory to read all the tax returns related information and confirm yourself that your business meets all the VAT returns requirements. A business owner must file the tax return on the online portal of FTA. In case of failure to file a tax return within a specified timeframe, would lead you to be a VAT violator and you would be considered as liable for fines and penalties according to the norms and laws of Cabinet resolution number 40 on administrative penalties for violations of tax laws in the UAE.

Expert UAE Vat Consultancy Service Answers Your Most Pressing Questions

The recent introduction of VAT by Ministry of Finance in UAE has introduced a new spin in corporate financial management. From 1^st January 2018, Federal Tax Authority requires all companies with a turnover of AED375, 000 or more per year to register and file for VAT. All financial documents must be prepared promptly and filed to avoid conflicts with the law.

There are penalties that will come with failure to file the returns or filing the wrong figures. Your cash flow may be affected by the government imposing penalties that would make your operations more expensive. Here are a few issues you need to know about the VAT to avoid conflicts with the law and penalties on your operations.

Differentiate between Sales Tax and VAT

Sales tax is only levied on goods at the final step of the sale. VAT, on the other hand, affects all goods and services through the process of production. This means that you will get a single tax on sales while VAT requires evaluation at every point during the process of production.

How will VAT be collected?

The responsibility to collect VAT lies with individual businesses. This makes the businesses agents of the collecting VAT. As such, you must know the amount to collect and also submit it with a great deal of accuracy. In case the government finds that some finances have not been collected or declared, your business will be in trouble. Engage expert VAT Consultancy Service to ensure that your financial filing and records are compliant with government demands. With the assistance of experts, your records will be accurate and therefore save your business from government-imposed penalties.

Responsibilities for Businesses over VAT.

All businesses have the responsibility to charge and remit VAT on behalf of the government. The responsibilities are as follows.

• Every business must charge VAT on all goods and services that are taxable. To avoid double taxation, an expert on VAT will guide you on the steps to take to ensure that you comply with the law.
• A business can reclaim from the client any VAT paid on behalf of clients. This is usually in situations where a business has already paid the tax.
• Maintain proper and comprehensive records to enable the government to evaluate your payments. These records can be accessed any time the government wants to verify whether you have made the correct VAT payments.

Actions that would lead to Penalties

The government will find you in contempt and even penalize you for the following offenses, among others.

• Failure or refusal to register your business for VAT while it is eligible for registration.
• Submitting inaccurate VAT or failing to submit the money at all.
• Failing to preserve proper records of VAT as required by the law. These are the records used to verify whether you paid the requisite amounts.
• Evading tax

The new laws on VAT are bound to challenge financial flow and management for your business. An expert from VAT Consultancy Service evaluate your responsibilities to ensure that you comply with the law. The consultant ensures that your business operations are free of penalties for breach of legal requirements.