Comprehensive guide on Vat Registration in UAE

Value Added Tax (VAT) has become obligatory for almost all businesses in the UAE. So, the companies can register for VAT free of cost as per the guidelines of the Federal Tax Authority (FTA). The applications are accepted 24/7 through the official website of the FTA.

Here arises a question of what are the requirements that every company should comply with the rules for successful registrations and other Supporting details. Don’t worry as the article is going to help you know everything from A-Z.

Process of Vat Registration Made Easy for Businesses in UAE

According to the FTA, the official representative of the taxable individual can register for VAT by complying with the essential steps. Keeping the complexity of the matters in mind, business organizations generally acquire the services of the best VAT consultancy in Dubai based professionals to ensure successful compliance. It’s because VAT is relatively new to most of the business people.

However, it is essential to have a basic understanding of the process for ensuring confidence in the later stages of compliance after registration. So, the procedure of how to register for VAT is explained in detail below:

Thresholds for VAT Registration in UAE

The first and foremost important requirement for registering VAT in the UAE is to consider if your business falls in the set-criterion for paying VAT.

1) The businesses generating the annual income higher than AED 375,000 are obligatory for VAT registration.

2) The businesses with annual income between AED 187,500 & AED 375,000 are required to register voluntarily.

3) The business startups that have more than AED 187,500 VAT related expenses are required VAT registration.

In a case that your business revenue is under the threshold for VAT, you should consider registering your business voluntarily to avoid future inconvenience.

Required Documents to Register for VAT

The business companies are required to maintain a proper record of documents to meet the VAT obligations as per FTA recommendations. Here are given a list of documents that every business is required to maintain:

1) Passport copy of the owner and partners

2) Copy of Trade License

3) Emirates ID of the owner and partners

4) Company’s Bank Account details and IBAN

5) Memorandum of Association (MOA)

6) Customs Authority Registration code

7) A complete record of Business revenue for the past year including financial sheets, audit reports, and bank statements

It is imperative to note that businesses should provide the mentioned documents for a must ensure the completion of the registration process. An inability of document provision can potentially lead to Vat penalties in UAE.  So, it’s better to maintain a proper record of your business to eliminate risks in advance.

Other information required to registration

The additional information required for completing the process of registration is as given below:

1) The address or PO Box number of the company

2) A statement of revenue projection for next one month

3) Detail of import and export business activities

4) Detail of the tax group along with tax number

E-Service Account Creation

The process of registration for VAT compliance starts from creating an account over the official website of the Federal Tax Authority (FTA).  The companies are required to sign up using an email address such as yahoo or Gmail. The steps are as given below:

1) Open the website link https://eservices.tax.gov.ae/en-us/signup

2) Add all required detail and set a secure password along with security question

3) Open your mailbox to check and verify the email address

Apply for VAT Registration

Account creation is a fundamental step for registering your business to comply with VAT regulations. Once you have done with the account creation process successfully, now you can move to apply for the VAT. The steps are simple as you have to do the given:

1) Signed in to the account of e-Service from the link: https://eservices.tax.gov.ae/en-us/login

2) Click on “Getting Started Guide” and read all information to get better insights for VAT

3) After reading the detail given in the guide, you have to check the confirmation checkbox to proceed

4) You will find the sections “About the applicant, Details of the applicant, Contact details, banking details, Business relationships, About the VAT registration, Declaration, Review & submit.”

5) Fill the VAT form that contains 8 sections requiring all information about your business

6) You will be notified after registration by SMS and email after TRN generation.

Once you have successfully registered for VAT compliance, you should consider your responsibility as all taxable persons or companies have to submit their VAT return to the FTA. For this purpose, consider getting detailed insights on Vat Return filing in UAE to eliminate the risks of errors and mistakes.

A final thought on the VAT registration process

Value Added Tax (VAT) is recently introduced in the UAE and a few other countries in the Middle East. Owing to this reason, it is something new for many business people who make it difficult to comprehend the procedure. The companies should pay greater attention to understand the process.

Hopefully, you have got a fair idea of the whole scenario of registering your business for VAT compliance.  All you need to do is to read the instruction carefully and fill the detail wisely for error-free account creation and registration. In a case of any confusion, you can take services of the best VAT consultants in Dubai for in-depth understanding to comply with the requirements as required for the businesses.

Remember! The VAT registration and compliance are mandatory for all businesses falling in the category of VAT payables. You have to make sure to keep things accurate!