VAT Registration in UAE 

As a business or individual receiving commercial consideration, VAT registration is mandatory if your taxable supplies exceed AED375,000 in the next 30 days.  

For many businesses, registering for VAT often leads to frustration and delay. It is a common misconception that the same rules and ease of registering at the initial launch of VAT in January 2018 apply.

The VAT system is evolving from empirical data and market experience and consequently, due processes will also change to reflect these considerations. 

Understanding VAT Registration in the UAE

To get a better understanding of VAT registration, here are some important considerations to note.

Early Years

During the first year of VAT, it was evident that many companies and individuals operating in the UAE registered for VAT, others waited and some (especially individuals or directors) were unclear how they should comply. 

Before January and in Q1 2018, registering for VAT was relatively easy and fast. All who applied were subject to self-declaration statements and received a Tax Registration Number (TRN).

This complied with the FTA strategy to bring into the system as many eligible tax payers for the introduction of VAT.

Current Year 

The emphasis is now on applicants to provide demonstrable and sufficient evidence to meet the registration requirements in securing a TRN on time.

This entails significantly more understanding and preparation to ensure the application progresses smoothly and that it is finalised as promptly as possible.

Prolonged applications due to a lack of preparation cause avoidable delays with negative consequences, especially if the taxable periods are retrospectively set. In this

Common Challenges

Experience and understanding of FTA processes and requirements are essential to avoid issues and unforeseen consequences.

From our experience, the most common issues for delays or rejections include:

1. Lack of planning and preparation. Have you planned the application before exceeding the threshold and made sure that you have collated all the required documentation? 

2. Inability to prepare a clear basis for registration. If you are asked, have you prepared the transactional summary to present the calculation for taxable supplies? 

3. Lack of details in supporting the basis of your registration. Do you have all the required documents required to submit your submission?

4. Lack of understanding of FTA requirements and processes. Have you read and understood the FTA guides and processes? 

5. Changing FTA policies. Is this your first time or did you register another company sometime back? If so, it is likely you may not be updated with the current protocols and will be unprepared.

VAT Registration Support 

If your business is unsure and inexperienced with the FTA requirements and regulations, it is highly recommended that you get support from an experienced VAT registration specialist.

As a registered tax agency we are often requested to resolve submission issues resulting from one or all of the issues listed above.

Many requests could have been resolved with assistance at the outset of the process to build a credible basis for the submission.

Starting with professional support will save time and frustration, ensuring full compliance with the FTA. It will also prevent negative financial consequences that drain resources when you need to be focusing on growing your business.

Simply Solved is an ISO 9001 certified company and a registered tax agency with a team of experienced tax agents that provide high-quality, cost-effective accounting and bookkeeping services including VAT registration for companies of all sizes.