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How to File VAT Return in UAE – Steps for VAT File Returning

November 25, 2021

According to the VAT registration guidelines, the registration is categorized into voluntary VAT registration, mandatory VAT registration, and exemption VAT registration.

Not every business is required to get VAT registration in UAE; only those whose value of taxable supplies surpasses AED 375000 over the preceding 12 months’ period or if it surpasses the threshold in the flowing 30 days.

Most of the businesses in the UAE are supposed to file VAT returns on a quarterly basis if the annual turnover is below AED 150 million. On the other hand, a particular class of businesses is expected to file their VAT returns after every month in cases when the annual turnover exceeds AED 150 million.

It’s noteworthy to know that FTA may assign a different tax period for a specific class of businesses at its choice.

What are the Necessary Steps to Register a Business For VAT in UAE?

Registering your business for VAT is entirely an online process, and it can be done via FTA’s portal only.

In UAE, the FTA has not yet passed any guideline that allows an offline VAT return filing. The business entities that register for VAT should file the return in the VAT 201 form.  This form can be used by all the VAT registrants upon the expiry of the tax period. On behalf of the taxable persons, registered tax agents living in Dubai can file their tax returns.

After you log into the FTA portal, you’ll require to check the following:

  1. Tax refunds that are given to tourists
  2. Standard rated supplies
  3. Supplies that are subjected to the Reverse Charge Mechanism Provision
  4. Exempted Supplies
  5. Zero-rated supplies
  6. Standard-rated expenses
  7. Calculation of due tax
  8. Imported goods
  9. Refund of recovered tax
  10. An Accurate Calculation of due tax

However, if, you still have uncertainties regarding this, then you can always seek guidance from Avyanco. Refer to the best team when it comes to assisting you in filing a VAT return. Avyanco Auditing is one of the most experienced units when it comes to taxation and financial advisory in UAE. We file your VAT returns after a proper assessment. We calculate each item of purchases and sales, and this ensures 100% accuracy.

How to file VAT Return in UAE

If you’re a taxable person residing in UAE, then you will be required to file a VAT return to the Federal Tax Authority (FTA) at the end of every tax period. A VAT return shows the value of the purchases and supplies that a taxable person makes during the specified tax period, showing the person’s VAT liability.

According to Article 64 of the Executive Regulations of the VAT Decree-Law, the Federal Tax Authority expects to receive the VAT Return latest by the 28th date, following the end of the tax period. Late-filing or no-filing of VAT returns can result in dire consequences.

So let’s do a thorough analysis pertaining to the VAT returns filing process. Below we have briefly described the most common queries and misconceptions that people have about it.

When do Businesses Need To File VAT Returns?

UAE levies a 5% VAT at the point of sale.

What are the Possible Consequences of Non-Compliance With VAT Return Filing Requirements in UAE?

Prepare yourself to receive hefty penalties from the Federal Tax Authority if you fail to comply with the UAE VAT Return Filing laws.

Some common VAT administrative penalties pertaining to the return filing include a penalty of 1000 AED is charged on the VAT registrant who does not file the return on the given timeframe as fixed by the FTA. Moreover, the VAT registration will also be liable to pay AED 2000 as a penalty for repeating this offense within a period of 2 years.

What are the Mistakes That One is Likely to Make While filing a VAT Return in UAE?

This is one of the most frequently asked questions that concerns people who are filing a VAT return in UAE for the first time.

There are three common mistakes that people make while doing so.

  1. Accidently Filing Incorrect VAT Return
  2. Intentionally Hiding the VAT Errors
  3. Failure in Filing the VAT on Time

If you commit any of the above-mentioned mistakes, then you can expect to get slapped with the below penalties

  1. Payment of AED 3000 as a fixed penalty for the first time, and payment of AED 5000 as a penalty for repeating the same mistake again.
  2. A percentage of the unpaid amount will be paid as a penalty to the FTA in case of an error.

Are There Any VAT Consultants in Dubai?

Yes, there are a number of VAT Consultants in Dubai that you can reach out to.

It is advised to most people to seek VAT consultants if it’s their first time filing a VAT return. VAT Consultants offer great assistance to laymen who do not have prior experience in filing VAT returns. Such VAT consultancy services in Dubai comprise a staff of qualified tax team that offers you a clear understanding of this process every step of your way.

Businesses and individuals in Dubai can easily reach out to Avyanco and get expert advice on all matters pertaining to taxation including VAT.

How Can Avyanco Help You in Filing Your VAT Return Dubai and UAE?

For a smooth VAT return filing experience, you can seek help from Avyanco. Our guidance is bound to make the process simpler. It’s a reliable auditing and consultancy firm based in Dubai, UAE that possesses high-quality VAT consulting services in Dubai. Our objective is to offer their customers effective VAT return filing assistance, compliance, support, and other relevant services. Whether it’s about recording the bookkeeping of your firm or filing the VAT return, Avyanco is always an open option for you to sort out your financial dealings.

Our key services include:

  1. VAT compliance process
  2. VAT registration
  3. Managing tax inspection
  4. Filing Vat returns
  5. Payments of return submissions

Scroll through our various Taxation-related services that you can benefit from. We have a team of advisors, accountants, and tax agents that are proficient in VAT rules and regulations and taxation laws of UAE. Our expertise helps businesses in managing the impact of TAX and VAT issues on their ongoing business dealings.

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