Value Added Tax or VAT is a form of indirect tax imposed on the use or consumption of goods and services at each point of sale.  The cost is ultimately borne by the end-consumer. Businesses and organizations collect the VAT on behalf of the government. With the introduction of VAT in UAE on 1 January 2018, consumers are expected to pay 5 percent for the product or service they use. By availing the right VAT services in UAE, you can easily manage the VAT aspects of your business. Being registered under the UAE VAT law stipulates that your business is recognized by the government. Consulting a VAT service provider in UAE eases all your VAT-related processes, thereby making your business abide by the Emirati VAT laws and regulations. Priority Services is one of the leading VAT service providers in UAE, which offers exclusive VAT services including VAT registration, VAT deregistration, VAT return filing, VAT accounting services, and more.

Value Added Tax for UAE Businesses

The United Arab Emirates introduced a new form of indirect tax called Value Added Tax (VAT)  in UAE on 1 January 2018 with a rate of 5 percent on goods & services. The VAT policy assumed by the GCC countries potentially widens the economic scope of the countries by integrating an additional source of revenue in the wake of the oil crisis. This new source of income will be utilised for high-quality public services by shifting to a more sustainable consumption system. It also aims to reduce the government’s dependence on oil and other hydrocarbons as a source of revenue. VAT consultancies in the UAE provide various VAT services across the Emirates easing the activities related to Value Added Tax registration, deregistration, accounting, return filing, advisory services, etc. The implementation of VAT in UAE has brought major changes in the taxation system of the Emirate. Getting proper VAT services in UAE helps businesses to avoid the risk of unnecessary tax payments and maintain accurate VAT records, tracking up-to-date information regarding VAT filing

What is VAT?

Value Added Tax or VAT is a tax on the expenditure or use of goods and services imposed at each point of sale. The bearers of the cost will eventually be the end-consumer. Organisations are obliged to collect and account for the tax in aid of the government. VAT in UAE is applicable uniformly on tax-registered businesses running both on the UAE mainland and in the free zones.

Difference between Zero-rated & Exempted Tax supplies

Good and Services on which zero-rate (0%) tax rate is levied are Zero-Rated supplies. For zero-rated supplies, input tax can be recovered. Examples:

• Exports of goods and services
• First sales/rent of residential buildings
  
• Certain educational services and related goods and services
  

Goods and Services on which VAT is not levied are Exempted supplies. Also, if all your supplies are in the category of exempted supplies, you are not required to register for VAT. And even you cannot claim for Input tax as well.

• Financial Services like life insurance
• Residential Buildings
  
• Bare Land
  
• Local Passenger Transport