Value added tax

Value Added Tax (VAT) is a consumption tax that the UAE Government imposes on each stage of supply at a rate of 0% or 5%. This is an important part of the country's strategy to improve the economy and development. Al Arish Tax Consultancy has extensive experience in the field of local and international taxes. We develop strategies to solve all tax related issues and help companies to register mandatory or Voluntary for VAT purposes.

1- Registration for VAT

There are two types of registration for VAT which are determined based on the volume of taxable supplies:

Mandatory registration: - 

If your business generates Taxable Supplies of more than AED 375,000 in the last 12 month or expected to exceed within the next 30 days then it is mandatory to register for VAT.

Voluntary registration-:

Where any activity can register for VAT voluntarily, but the minimum limit of Taxable Supplies or Taxable Expenses for voluntary registration must be AED 187,500 in the last 12 month or expected to reach this threshold within the next 30 days the authority shall register a business with effect from the first day of the month following the month in which the application is made.

Al Arish Tax Consultancy will help you to register for VAT in the United Arab Emirates through:

• Assessing the eligibility to register for VAT
• Register for VAT, whether as a sole establishment company, limited liability, or as a tax group
• Assistance with timely registration to avoid penalties resulting from late registration

2- De-registration of VAT

Any taxable person can De-register VAT registration in two cases:

• If the taxable supplies did not exceed the Voluntary registration limit in the Last 12 months and are not expected to exceed this limit within the next 30 days.
• If the business stops making taxable supplies.

 For this reason, Al Arish Tax Consultancy reviews taxable supplies and ensures the company's eligibility to continue registration for value-added tax or not, in order to avoid Late De-registration penalties.

 3- Refund of the value-added tax

A Taxable person can submit a tax refund request in case if he has a tax credit balance or if the taxable Expenses is more than the taxable supplies.

Also the tax credit balance can be used to settle future tax liabilities.

Al Arish Tax Consultancy will assist you to review the documents and checking the eligibility for submitting the tax refund to avoid tax refund rejection.

4- Submitting and reviewing VAT returns

The tax return must be submitted quarterly (every 3 months) or it can be submitted monthly in special cases.

Al Arish Tax Consultancy provides all assistance to clients in submitting tax returns and reviewing all documents to ensure that the tax return is submitted in a timely manner to avoid administrative Penalties resulting from delay in submitting the tax return.

Corporate tax

What is corporate tax?

Corporate tax is a form of direct tax imposed on net income or business profit that the UAE will start applying to companies starting in 2023.

The purpose of corporate tax

• Enhancing the country's position as a leading global centre for business and investment
• Accelerate the development of the country and its transformation to achieve its strategic goals
• Renewing its commitment towards meeting international standards of tax transparency and preventing harmful tax practices.

Corporate tax will apply to:

• All businesses and individuals that carry out business activities under a commercial license or permit to carry out commercial, industrial, or professional activity in the country.

• Businesses established in free zones So that the corporate tax system will continue to provide corporate tax incentives, which are currently provided to businesses established in free zones, which comply with all regulatory requirements and do not conduct commercial activities in the mainland of the UAE.

• Foreign companies and foreign individuals if they carry out a continuous or regular commercial activity in the UAE.

• banking operations

• Companies operating in the field of real estate management, construction work, real estate development, real estate agencies, and real estate brokerage activities.

Exceptions to corporate tax

However, there are some exceptions that do not require some companies to be subject to corporate tax, including the following:

• Natural resource extraction activities and businesses that will remain subject to corporate taxes at the local emirate level

• Businesses in the country will be exempt from paying corporate tax on dividends and capital gains received from their qualifying shares.

• Eligible transactions between companies in the same tax group and restructuring provided the necessary conditions are met.

• An individual's salary or other income earned from employment, whether received from government work or from the private sector
• Interest and other types of income from bank deposits or savings schemes earned by individuals for the state's corporate tax
• Investment in real estate by individuals in their personal capacity

• Foreign investor income generated from dividends, capital gains, interest, royalties and other investment returns

• Stock dividends, capital gains, and any other income generated through their ownership of shares or any other securities in their personal capacity.

In light of the new data, which will be effective from the beginning of the new year, the corporate tax rate will be 0% for taxable income up to 375,000 thousand dirhams, and 9% for taxable income that exceeds 375,000 thousand dirhams.

Therefore, Al Arish Tax Consultancy pledges its experience in the field of taxation to provide all assistance in registering corporate tax easily and verifying the company's sufficient revenues that obligate it to pay the tax to the state. Al Arish tax consultancy also helps you if you are a small company or a self-employed business that does not require registration in corporate tax.

Mosque tax refund

The Donor Shall have the right to request a refund of Input tax incurred on the construction or the operation of the mosque based on cabinet decision No. 82 of 2022 Issued 16 August 2022.

Al Arish Tax Consultancy provides all assistance to donors to recover the Input tax incurred on construction / operation of the mosque.

New Residence Tax Refund

Where a UAE National owns or acquires land in the UAE on which they construct his / her own residence, he / she shall be entitled to request FTA to refund the VAT on the expenses incurred on the construction of the residence, Refund request shall be submitted within 12 months from date of completion certificate. 

Al Arish Tax Consultancy will assist you to recover the maximum amount of Input VAT paid as your refund file will be analysed under the supervision of tax experts to save time and effort.

Al Arish Tax Consultancy assists all its clients in all matters related to taxes, including submitting requests for refunding the value-added tax imposed on newly constructed residences, after 12 months have passed since the residence has been occupied.

The company is also working to ensure the permissibility of submitting a request for a citizen's housing tax refund and verifying the eligible expenses for a tax refund.