Maintain your tax compliance through Filings.ae platform at an affordable price. Get support from Experienced Accountants for bookkeeping, financial statement preparation, VAT and Corporate Tax filing.
Maintain your tax compliance through Filings.ae platform at an affordable price. Get support from Experienced Accountants for bookkeeping, financial statement preparation, VAT and Corporate Tax filing.
Maintain your tax compliance through Filings.ae platform at an affordable price. Get support from Experienced Accountants for bookkeeping, financial statement preparation, VAT and Corporate Tax filing.
Manage your business and track services |
Manage your business and track services |
Manage your business and track services |
All the VAT-registered businesses in UAE must file VAT returns with the Federal Tax Authority (FTA) to avoid penalties. UAE VAT registration is mandatory if your business exceeds AED 375,000 in taxable supplies or imports (past year or expected in the next 30 days). Voluntary registration is an option for businesses exceeding AED 187,500. Startups might not reap the annual turnover necessary for mandatory VAT registration, but they can still register for VAT voluntarily. This article presents information regarding the VAT return filing for startups in the UAE, benefits, and the procedure.
Filings.ae helps startups file VAT returns in an FTA-prescribed format with expert assistance!!
VAT return filing in UAE is the process where registered businesses electronically submit a summary of their taxable activities to the Federal Tax Authority (FTA) at prescribed intervals. This report details the Value Added Tax (VAT) collected on sales (output tax) and the VAT paid on business purchases (input tax) during a specific tax period (usually quarterly or monthly). Based on this information, the return calculates the net VAT liability, the difference between output tax and reclaimable input tax. Businesses must then settle any outstanding VAT amount to the FTA by the due date to comply with UAE tax regulations.
In the United Arab Emirates, the frequency of filing Value Added Tax (VAT) returns depends on the business. Most businesses fall under the category of quarterly returns, meaning they file their VAT returns every three months. However, the Federal Tax Authority (FTA) may require certain businesses to file monthly returns. Regardless of the filing frequency, all VAT returns must be submitted electronically through the FTA's eServices portal by the 28th day of the month following the end of the tax period. The deadline is extended to the next business day if the due date falls on a weekend or public holiday.
The following points emphasize why filing VAT returns for startups in UAE is useful and beneficial:
Here are the step-by-step instructions to file VAT returns in UAE,
The UAE uses a standard VAT rate of 5% on most goods and services. However, the system also incorporates two exceptions: zero-rated and exempt supplies. Zero-rated supplies, like exports outside the GCC, are technically taxable but incur a 0% VAT rate. This allows businesses to claim back input tax on these transactions. Exempt supplies, like specific healthcare and education services, are not subject to VAT at all.
In summary, VAT return filing is mandatory for VAT-registered businesses in the UAE. While not always required for startups, voluntary registration offers valuable benefits like building credibility, recovering input tax, and preparing for future growth. The filing process itself involves gathering detailed transaction records, calculating VAT liability, submitting the return electronically, and settling any outstanding payments. Understanding the UAE's VAT rate structure, with its standard 5% rate alongside zero-rated and exempt categories, is crucial for accurate filing.
File your VAT returns before the due date & avoid penalties with Filings.ae experts!!
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