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Value added tax in UAE

               Value-added tax in UAE

VAT (value added tax) was introduced in UAE in January 2018. it will provide the UAE a
new source of income and help its future plans to reduce the dependency on oil and other
hydrocarbons as a source of revenue. The UAE coordinates VAT implementation
with other GCC countries because they all are connected to each other through ‘The
Economic Agreement between the GCC States’ and ‘The GCC Customs Union’.As a
result, the cost of living will be slightly higher but this will depend on each individual
and his spendings if he spends his money on the vat relieved products he will not
feel any changes.
Any business will need to document their income, costs, and VAT to keep a record to
allow the government to check that everything is right. They must charge VAT on
taxable goods or services they supply as well as they may reclaim any VAT they
have paid on them.
You can register the vat for your business through the E-services of the Federal Tax
Authority, the vat will be collected on behalf of the government as 5% of the cost of
the taxable goods or services, even the tourists will pay it.
At the end of each tax period, the registered vat business must submit an AT return
form to the FTA that summarises the value of the supplies and purchases a taxable
person has made during the tax period and shows the taxable person’s VAT liability.
taxable businesses must file VAT returns with FTA on a regular basis and usually
within 28 days of the end of the ‘tax period’ as defined for each type of business. A
‘tax period’ is a specific period of time for which the payable tax shall be calculated
and paid.
Failure to file a tax return within the specified timeframe will make the violator liable
for fines as per the provisions of Cabinet Resolution No. 40 of 2017 on
Administrative Penalties for Violations of Tax Laws in the UAE.

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