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VAT Registration in UAE

Company setup in Dubai
Business & Strategy

Things to know about Company formation in UAE

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The UAE is such a welcoming world for any business, playing a prominent role in global trade and commerce. Many foreign investors look forward to starting company setup in Dubai as the government is supportive, total freedom for company formation, 100% trade ownership, full revenue repatriation and business-friendly taxation. Thus, the country has become a popular choice of investment globally. Registering a foreign company in the UAE Foreign businesses in the UAE normally set up a branch or a Representative office. The branch is allowed to carry out commercial activities within the UAE but Representative offices can only market their products but cannot get a profit within the UAE. Both forms of companies have to obtain a commercial registration and license, linked to the parent companies. Freezone business in UAE The seven Emirates in Dubai have free zones with special taxes, customs, and import regimes. Company setup in Dubai Free zones is the best choice to start up a business as the company can enjoy 100% foreign ownership, complete profit repatriation, 100% exemption from any income tax, visa quotas, 24/7 access and more.  There are almost 40 free zones in UAE. Also, the company registration in the free zone Is relatively simple once the documents got ready. Characteristics for free zone company formation Choose the right free zone that allows the business to expand on a wider scale. Chose the one that supports your business requirements and activities Different free zones have different rules and regulations and also the number and types of documents required, vary according to free zone and type of business activity Differences in share capital requirement in various free zones Free trading between free zones and any import/export activity without any tax or duty Mainland business in UAE Limited Liability Company setup in Dubai is the most prevalent form and the standard type of business in the UAE mainland. These Onshore companies are a popular choice for traders, professional services, and retail businesses. Onshore companies are licensed by the Department of Economic Development (DED) and governed by the UAE Commercial Companies Law (CCL). Onshore companies can take part in business activities without the restrictions of the location. Choose the business activity and an ideal location Determine the business legal structure Get a local sponsor or local service agent Get a mainland trade license Apply for relevant visas Secure an office space Sole Proprietorship When you want to operate as the sole owner of the company, then go for the sole proprietorship in which the owner will have to assume all financial responsibilities of the company. In a sole proprietorship, the business entity is owned by one individual with the trade license issued in his/her name. Unlike a UAE Mainland company which requires at least 51% of shares registered to a UAE/GCC national sponsor, a sole proprietorship is granted 100% ownership of the business entity. To successfully register for a sole proprietorship, necessary documents are to be furnished. Offshore business in UAE Offshore businesses are quick and easy to set up which makes them yet another prevalent choice of company formation in UAE. Offshore companies are international businesses offering no tax or low tax benefits.  These companies are set up with the purpose to work outside its jurisdiction. The benefits of setting up an offshore company include an opportunity to expand to the international market, a business-friendly environment, tax neutrality on your earnings, etc. One may face no or fewer complications for offshore company registration. The procedures take a few weeks to complete with the submission of required documents. No corporate tax to pay with 100% foreign ownership Hassle-free incorporation processes Lawsuit protection Protected assets Privacy Choice to issue many classes of shares Just one shareholder and one director required Start your company with MAATS Any type of business you opt for, MAATS, the best accounting services in Dubai to setup company setup in Dubai, let our experience and knowledge guide you through the procedures involved in company formation. We reduce any workload from your side so that you can sit back and relax, just furnishing the required documents and getting involved only where you have to. Get in contact with us to start your business in UAE the easiest way.

VAT registration in Dubai, benefits of vat registration uae, maats consultants
Business & Strategy

Benefits of VAT registration In UAE

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Registering the business under VAT UAE Businesses that aren’t mandatorily required to register for VAT are offered voluntary VAT registration if the annual supplies or the taxable expenses incurred on the business are not less than the voluntary registration threshold limit. As you register the company for the VAT, the government acknowledges your business, which aids certain financial benefits unlike for unregistered businesses in UAE. Who should get registered under VAT As mentioned, not all businesses are subjected to registering under VAT. Those businesses crossing the set annual turnover threshold are subjected to registering under VAT. A business is required to register for VAT if its taxable supplies and imports exceed AED 375,000 per annum. For businesses whose supplies and imports exceed 187,500 per annum, VAT registration is optional. As simplified, one can go for voluntary VAT registration if 12 months’ revenue is close to 187,500 AED and mandatory registration if the value exceeds 375,000 AED or 100,000 USD. While the law allows you to voluntarily register for VAT, let’s see what business benefits await a registered business. The privilege of input tax deductions A registered business under VAT can claim input tax deductions. The total VAT paid on the purchase is input VAT and the total VAT collected on sales is known as output VAT. If the input VAT is 335 and the output VAT 450, you are eligible for the entitlement of an input VAT deduction against the output VAT of 450, making the final VAT payable 115. Such an input tax claim can be put forward only if you have registered your business under VAT. Or else, the total VAT paid on purchases is expected to be considered as a cost. Tax refund for new businesses Even when the sales do not exceed the threshold but the expenses do, one can apply for VAT registration. For a new business or startup, the initial spending or investment is of a higher amount and takes time for the sales to establish with profit. In such a case, being registered under VAT will let you claim the VAT paid on your purchases/expenses which otherwise would be calculated as cost. Any registered businesses under VAT can claim input tax deduction upon the premises of VAT. When a non-registered business pays 5% VAT on purchases/expenses, it makes your business/product 5% pricier as compared to a registered business. When you are not registered for VAT, the VAT paid on purchase should be treated as a cost leaving you without an option but to just inflate the price. Apart from all these, having registered under VAT provides the business with a VAT registration number adding credibility to your business. This can help you build your business and also gives the company a professional position. MAATS services in VAT MAATS the leading accounting service in Dubai has got a dedicated team of VAT registration in Dubai specialists open for consultation anytime. Our strategies have proven to make the procedures of VAT registration simple and timebound. Feel free to reach out to us with VAT-related queries.

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