UAE has no plans to increase VAT

The UAE has no plans to increase its VAT (value-added tax) rate

UAE has no plans to increase its VAT (value-added tax) rate, the country’s finance minister said after Saudi Arabia said it would triple its rate. In Saudi Arabia VAT is increasing to 15 percent from 5 percent from July 1, seeking to shield finances hit by low oil prices and a slump in demand for its lifeline export worsened by the new coronavirus pandemic. The UAE has no immediate plans to increase value added tax (VAT), officials have confirmed.

“The UAE always following protective measures and begin financial initiatives, which protect the national economy and support various business sectors in the country.”

The UAE’s VAT rate currently stands at 5 percent and was implemented at the beginning of 2018 to promote the country’s economic growth and to wean itself off dependence on oil revenues.

In UAE FTA declared in April about VAT payment deadline, that it would delay the due date for payment of VAT from March 31 until May 28, as a measure to support the country’s economy amid the COVID-19 coronavirus pandemic.

Why Register for VAT?

Prior to registering for VAT, it is important to know why. Basically, a value-added tax is imposed on qualified good and services. These taxes are paid by end-consumers and are collected and accounted for by businesses on behalf of the government. Companies are required to register for it if their taxable turnover within a 12-month period is more than AED 375,000 or it the taxable turnover is expected to go over the said amount in the next 30 days. If your company does not go over AED 375,000 but is over AED 187,500, you can voluntarily apply.

How to do VAT Registeration in Dubai?

According to the Federal Tax Authority (FTA), taxable entities or their official representatives can register for value-added tax through the FTA website. This can be done in three steps and is no longer than 20 minutes. You only need to go to www.tax.gov.ae, navigate to E-services and create an account. Keep in mind that you will need to verify your email address
before you can log in and register your company.

When you register, make sure that you have pertinent documents on-hand. This includes your business or trade license, passport or Emirates ID and duplicate copies, and proof of authorization. In case you do not have these on-hand, you can save your application and resume when you are ready.

How to register your company VAT number?

Generally, the process of registering for Value Added Tax can never be getting easier. To facilitate the businesses who want to register their company VAT number, the Federal Tax Authority (FTA) has opened its portal for online VAT registration.

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