There are many common mistakes that you should avoid when applying for VAT registration in Dubai. It is essential to ensure that you submit the correct files in the correct sections of the application. Moreover, you should avoid using the wrong spellings or Arabic in your files, as they can delay the registration process. By following these tips, you can successfully obtain your VAT registration in Dubai. Although you can handle these tasks, hiring a reliable VAT agent in Dubai is better to make your process easier.
Common mistakes to avoid:
To ensure successful VAT registration in Dubai, it is important to comply with the rules and regulations. Miscalculations or errors could lead to hefty fines and penalties. To avoid such issues, it is best to take the support of VAT registration consultancies. The following are some common mistakes businesses should avoid:
Businesses need to account for the Reverse Charge Mechanism (RCM) when importing. Under normal transactions, the supplier collects VAT on behalf of customers and then pays it to the government. In the RCM, the supplier does not pay VAT on imported items, but the buyer pays the tax directly to the government. This rule is often overlooked by business owners. As a result, many fail to account for it.
Requirements for getting VAT registration in Dubai:
Before a business can apply for VAT registration in Dubai, it must be properly registered. There are several important requirements for a business to get VAT registration. These requirements include having a TRN or tax reference number (TRN) as well as complete contact details. These details are required to verify the identity of the company. If the business is a sole proprietorship, it does not require a TRN.
Cost of getting VAT registration in Dubai:
Whether you’re a small business owner or a multinational corporation, it’s important to know the cost of getting VAT registration in Dubai. Companies that generate more than AED 50,000 in revenue a year must register. Those with less income can opt for voluntary registration. While registering, companies will be able to receive refunds on the new tax. VAT returns are generally filed electronically at the end of each taxable period, but if your business generates less than AED 2 million, filing returns every quarter will be enough. Additionally, non-resident individuals and companies must register in Dubai for VAT.