The UAE government introduced 5% VAT in the UAE on January 1st, 2018. After this announcement, companies are required to obtain and file the tax to the authorities. However, most goods and services are required to the 5% VAT. It is important to know that some services or products are exempt from VAT, while others are 0%-rated. Being listed as per the VAT regulationon business means that a business is recognized by the government, as a supplier of Goods and Services and is legal to collect VAT from customers and remit the same to the government.
What is the step-by-step procedure for VAT Registration in the UAE?
Here is a detailed, step-by-step guide to help you navigate the process.
- Determine Eligibility for VAT Registration
The following is a briefing of the information that any business should gather before applying for VAT registration. It is important for one to note that any business is required by law to register for VAT in UAE if the total value of the goods and services supplied as well as the imported ones in the past year exceeded AED 375,000. Businesses with total supplies and imports between AED 187,500 and AED 375,000 may register for VAT voluntarily.
The newly established or small businesses should closely check their turnover to determine when they begin to register for VAT. It means that if your business has not reached the specified threshold but expects it will sometime in the next 30 days you are mandated to register.
- Gather Required Documents and Information
VAT registration is a rather formal procedure that can be launched only by having some specific documents and necessary details about your business. Some type of documentation that shows business operations such as;
- Contact information
- Details of bank accounts used for business transactions
- Financial records showing the revenue figures for the last 12 months
- Trade license copy
- Proof of business activity
- Certificate of Incorporation
- Passport and Emirates ID copies of the business owners and authorized signatories
This documentation ensures the FTA verifies your business information before VAT registration approval.
- Access the VAT Registration Form
Once your account is set up, log in and navigate to the VAT registration section. Here are some steps to follow such as;
- On the FTA dashboard, click on “VAT” and select “VAT Registration.”
- You will be directed to a registration form, which must be completed with precise details.
- Fill Out the VAT Registration Form
The form for registration of VAT is structured in several major parts such as;
- Name and address of the trade, its legal form, e-mail address, and phone numbers
- Enter basic business information like trade name, legal form, and contact details.
- Provide business activity information, business relationships (partners, etc.), and bank account details.
- You’ll need to input your revenue figures for the past 12 months and expected figures for the next 30 days. Ensure that you use these numbers correctly because they can demarcate your VAT registration numbers.
- For those engaged in the import/export business, please supply details of customs registration, where relevant.
- The final part is the certification part where the student attests to the fact that all the details accounted for in the paper are true.
- Submit the Application
Therefore, while finishing the form, it is important to check each of them thoroughly. Providing these steps, make sure that all that is correct, then apply. After completing the application, you will get an email from the FTA as a receipt of your application for VAT registration.
The FTA will examine your application and if all papers and details are correct, the VAT TRN will be issued within 20 business days. You will be notified through your FTA account to check the status of your application.
- Get Your VAT TRN
After getting approval on your application, you are issued with a VAT Tax Registration Number usually abbreviated as TRN. However, this number is imperative because it has to be encompassed in all the business’s invoices and tax returns. The TRN is evidence that your business is registered for VAT and must be used when transacting business with suppliers, and customers and for filing VAT returns. Keep your TRN secure and make sure to apply it consistently in all your business dealings.
Conclusion
The VAT registration process demands tax compliance for businesses in the UAE. Businesses can ensure opportune and accurate VAT registration, and minimize risks, by consulting top firms in UAE such as Corporate Tax UAE. Their team is well-capable in addressing all the issues effectively.
