As of January 01st 2018, all business entities that bring in an annual revenue of Dh375,000 and over, must register for VAT, after which they will be liable for a 5% VAT charge. Those that earn less than Dh375,000 but over Dh187,500 can register if preferred, although at this stage it isn’t mandatory. This includes newly built residential properties and any commercial properties for business purposes. Registered businesses who fall under the stipulated income threshold will be required to not only charge VAT from their customers, but also incur VAT from their suppliers in turn. The difference between the two will be paid to the state. Our VAT registration company dubai can offer you specialised guidance and assistance with conforming and adapting to the newly established rules.
Whilst businesses who do earn over Dh375,000 must maintain clear financial records as well, those who think they don’t need to register should also follow suit, mainly as this allows governing bodies to determine whether that particular business should register or not, by carefully assessing their data. Transparent bookkeeping is mandatory, and as such also warrants the needs for a competent bookkeeper in your team. Failure to comply with state-regulated VAT tax laws can lead to complicated implications, which are best avoided especially from a business point of view.
As a tax consultant dubai who’s been in the field for 15 years and counting, we bear a wealth of experience and insight into the subject, as well as helping businesses adapt to pivotal changes such as these. Hence, we can not only help your business with the complete process, we can also lend a hand during tax return season, by re-claiming any VAT you may have incurred on business-related transactions. This will help you avoid any unnecessary penalties, which can in turn cost your business heavily. All VAT tax transactions will be monitored and analysed by the Federal Tax Authority, who’s also responsible for penalising cases of non-compliance. Additionally, the Ministry of Finance also invested efforts in raising awareness and offering support in the months leading upto registration, as part of an effort to support companies through the transition, particularly small/ medium-sized enterprises.
If you’d like to straighten out the details of VAT registration and implementation and how they can affect your business, you’re welcome to contact our leading UK tax consultancy in dubai, Sarah Ferguson Tax Consultancy.