In UAE, every business that has Syearly revenue more than AED 375,000 needs a mandatory VAT registration, and in the case of companies whose yearly turnover is below AED 375,000 but exceeds AED 187,500 may have an optional and voluntary registration. Every business must keep a record of all their financial transactions and keep their ledgers transparent as well as updated. For VAT registered businesses, maintenance of business records is compulsory; this enables the government or auditor to check if all the things are in order. They must report the VAT charged and paid to the government regularly. Besides this, they need to charge an appropriate amount of VAT on their taxable goods and services.
To apply for VAT registration in UAE, you need to gather some documents. This includes:–
- Copies of Business Trade License or Commercial License.
- Certificate of incorporation or registration certificate.
- Passport copies and Emirates ID copies of the owner or the partners who are having the license.
- Memorandum of Association. This is not compulsory for individual foundations.
- Contact details of the company that includes complete address and P.O Box.
- Contact details of the concerned person which includes mobile number and e-mail.
- Bank details including account number, account name, bank name, branch name, and IBAN.
- Document regarding the physical office location of the business.
- Declaration about the business activities of the applicant.
- Income statement for the last 12 calendar months. It should be stamped and signed.
- The expected amount of revenue and expenses for the next 30 days after implementation of the VAT.
- Check whether the organization is exporting or importing. Documents related to it.
- Check if the organization is dealing with any custom department. If it is, then attach the VAT Registration Letter.
- Check if the foundation is carrying out business with any GCC country. If yes then gather the country name.
- Details about expected exempt supplies.
- List all businesses of the owner or partners in UAE within the last five years and their trade license copies.
All registrants are provided with a unique VAT number known as the Tax Registration Number by the Federal Tax Authority. This number is mentioned in various documents like VAT returns, Tax Invoice, Tax Credit Note, and all other documents that are authorized by the UAE VAT LAW and Executive Regulations.
VAT Registration in UAE.
VAT registration is classified into three categories – Mandatory, Voluntary and Exemption from VAT Registration. Depending on the annual aggregate turnover threshold, you will either have a mandatory registration or an optional registration. One can also seek exemption from VAT registration.
Initially, you need to create an e-service account with FTA. For this, visit ‘https://eservices.tax.gov.ae’ and then click the ‘Sign up’ option. Fill up all the details. On successful sign-up, you will receive an e-mail for verification. Then, using your credentials like username and password log-in to the account to proceed further.
After successful log-in, click on ‘Register for VAT’, you will be offered with a ‘Getting Started Guide’ for understanding important pieces of information related to the registration process. Click on- “Proceed”. You will get the VAT registration form that contains 8 sections. Update all the correct details. A ‘Green’ tick assures the completion of each section. Finally, review and submit the application form.