How VAT Services Work in Dubai:

Here’s a simplified breakdown of how VAT collection operates in Dubai:

Step 1: A farmer grows dates and sells them to a processing factory.

The farmer charges VAT to the factory.

Step 2: The factory processes the dates into date syrup and sells it to retail chains.

The factory collects VAT from the retail chain.

Step 3: The factory supplies processed dates to retail outlets.

Retail outlets charge VAT to consumers and receive a refund on VAT paid to the factory.

Step 4: Consumers purchase the date syrup, paying VAT.

Criteria for VAT Payment in Dubai:

• Companies with taxable exports and imports exceeding AED 375,000 per year must register for VAT.
• Optional VAT registration applies to companies with annual exports and imports between AED 187,500 and AED 375,000.
• Businesses collect VAT from consumers and remit it to the government, while also receiving refunds for VAT paid to suppliers.
• Multinational investors can claim VAT refunds on expenses incurred while visiting the UAE.

Checklist of Documents for VAT Registration in Dubai:

Ensure you have the following documents ready for VAT registration in Dubai:

• Company’s Trade License.
• Complete Company Contact Information.
• Turnover report with invoices.
• Bank details, including IBAN.

By adhering to VAT regulations and understanding the VAT process, businesses in Dubai can ensure compliance and manage their tax responsibilities effectively.