Value Added Tax (VAT) was recently implemented in the UAE, effective since 1st January 2018. MSI's UAE accounting member Alnoman & Ravi, Chartered Accountants provides an overview.
A standard rate of 5% VAT is applicable on any sale of goods or services. There are however a few products and services that come in the category of zero rated or exempt, where no VAT has to be charged. Every business that has a taxable turnover of over AED 375,000 annually, falls under the mandatory registration threshold and has to register for VAT. Businesses with a turnover between AED 187,500 and AED 375,00, have the option to register voluntarily. However, in the case of businesses with a turnover below, AED 187,500 cannot register for VAT, and will not charge VAT on their sales.
Tax, as a whole, is very new to the market in Middle-East, that has popularly been known for its tax-free business environment. As MSI's local member firm here in UAE we have taken the initiative since the announcement of tax, to attain a proper understanding of the tax policies, and has launched various services to help local businesses in the tax arena.
Alnoman & Ravi, Chartered Accountants has started services that help businesses comply with the new tax policies. This includes services such as Tax Consultancy, VAT Return Assistance, and VAT Registration Assistance. This is an especially important service in the UAE, as the tax policies are new, and businesses often find it difficult to navigate through the different procedures to stay in accordance with the tax laws.
Our new line of services helps business understand what tax policies apply to their individual businesses, and what procedures to follow to meet the tax requirements. This has helped numerous clients in approaching the new policies, but more importantly, has gone to show that business finds the use of our expertise in the field, as an external service very beneficial. Alnoman & Ravi not only performs these tax services to ease business work for each month but also trains the client in applying the relevant procedures, so the client is able to perform the work independently.
This development has expanded the horizons for MSI in UAE, as we add more professional services to aid businesses in the local market. These services have proved to be especially useful for new and growing businesses, as Alnoman & Ravi, Chartered Accountants continues to provide its professional expertise in business to the local business environment.
