PrimeFour Consulting LLC,
Prime Tower, 27th Floor,
Post Box No. 112037,
Business Bay, Dubai- U.A.E
VAT, or Value Added Tax, is a type of indirect tax in the UAE that is applied to the sale of goods and services at each stage of the supply chain. The end consumer ultimately bears the tax burden, but businesses collect and remit it to the government
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The UAE introduced VAT to diversify income sources and maintain the high standard of public services. It is a 5% tax applied to most goods and services
Let us say a mobile phone is manufactured and sold through various stages—manufacturer to wholesaler to retailer, and finally to the consumer. At each step, a 5% VAT is applied, and businesses can claim a refund on the VAT they have paid on their purchases.
The standard VAT rate is 5%, but there are categories like zero-rated (0% VAT), exempt (no VAT), and deemed supplies.
Businesses must register for VAT if their taxable supplies exceed AED 375,000 per year or voluntarily if it exceeds AED 187,500.
Standard-rated supplies: 5% VAT Zero-rated supplies: 0% VAT, but businesses can claim input tax. Exempt supplies: No VAT, and input tax cannot be claimed. Deemed supplies: Subject to VAT but not standard supplies. Out-of-scope supplies: Not covered by VAT.
Input tax is the VAT paid on purchases. Businesses can claim this amount back by keeping proper records of invoices and import documents.
All businesses must maintain records like balance sheets, profit and loss statements, payroll records, and more for five years.
Registered businesses need to submit quarterly VAT returns and pay their VAT liability to the government by the 28th day after the quarter ends.
Individuals may see a slight increase in the cost of living, depending on their spending habits. For businesses, they collect and pay VAT, and accurate record-keeping is crucial.
Penalties apply for offenses like not displaying price lists, failing to issue proper documents, and tax evasion. Penalties range from AED 2,500 to 300% of the evaded tax.
CEO, Exavibes
Working with Prime4 Consulting to establish our office in Dubai was a game-changer for us. Their team provided invaluable support throughout the entire process, from navigating legal requirements to finding the perfect location. Thanks to their expertise and dedication, we were able to smoothly expand our operations into Dubai and hit the ground running.
Founder & Director, Moods Investment Research Inc.
PrimeFour Consulting provided excellent guidance for setting up my company in Dubai and registering for VAT/Tax. Highly recommended!
Director, PNM consultancy
PrimeFour and its team have been instrumental in supporting our business ventures in the UAE and Middle East. Their exemplary service and dedication have consistently exceeded our expectations. With their expertise and guidance, we've navigated through complexities seamlessly, achieving remarkable results. PrimeFour's commitment to excellence and client satisfaction is truly commendable. We highly recommend PrimeFour to anyone seeking reliable and top-notch business support in the region.
Managing Director – Equinox
I have engaged Mr. Asif from PrimeFour Consulting in the UAE, and he has been an incredible ally in setting up our entities. His local knowledge is unparalleled. I highly recommend PrimeFour Consulting for Business Setup, Corporate Tax, and Management consultancy.
Zeptium Technologies LLC– Sales Manager
I have been thoroughly impressed with the exceptional service provided by PrimeFour Consulting. Their team has been incredibly prompt in responding to all my queries, ensuring that every concern is addressed with clarity and professionalism. I especially appreciate the valuable guidance I received regarding corporate tax filing process. PrimeFour Consulting has truly been a reliable partner in navigating the complexities of tax regulations, and I would highly recommend their services to any business looking for expertise and efficiency.
Consultant
I raised a query about the Corporate Tax registration process and deadlines with PrimeFour Consulting. They responded promptly with a professional and thorough explanation, addressing all my concerns. Excellent and efficient service from the PrimeFour Consulting team!
Consultant
PrimeFour Consulting provided exceptional support for my new company formation query. They offered a range of options with transparent pricing, making the entire process clear and straightforward. Their team followed up promptly to ensure I had all the necessary information. Excellent professionalism and prompt service.