Why is the computation of VAT important for businesses?
Value Added Tax (VAT) is a consumption tax. It is a tax imposed on the value that is generated at every stage of the production process. The Federal Decree Law No. 8 of 2017 introduced VAT in UAE. Since the time VAT Law came into effect on January 1, 2018, it has changed the taxation scenario for businesses. The law and supporting regulations mention the different products and services along with the VAT rates applicable to them. The VAT rates in UAE are either 0% or 5%, or the products/services are exempt OR Out of Scope from VAT.
Businesses must make an accurate VAT calculation on their goods and services to determine their yearly VAT liability. If businesses do not adhere to the VAT Law’s provisions, FTA will penalize them for violation. Therefore, businesses need to have proper documents in place for VAT calculations. It also includes every business transaction along with the supporting evidence.
VAT charged is the VAT that you have charged to your customers while VAT paid is the VAT you have paid to your suppliers. The difference between the two is the VAT amount that you must either claim from FTA (if VAT paid is more than VAT charged) or pay to FTA (if VAT charged is more than VAT paid). Therefore, accurate and timely VAT computation is significant for FTA compliance.
How to conduct VAT computation
VAT on any good or service is calculated as the reduction of input tax from output tax. In this case, input tax is the tax that you pay to the supplier or vendor for purchasing raw materials for producing the finished good or service. Output tax is the tax that you collect from your customers or clients on the sale of that good or service.
Our VAT Computation Services
We provide the best VAT computation services in UAE. We help our clients with a range of services to achieve VAT compliance, including VAT registration, deregistration, preparing and filing returns, VAT computation, conducting VAT health checks, assisting in VAT audit, handling VAT disputes, assistance in filing refunds, and legal formalities.
Accurate and timely VAT computation services are important for any business. We provide VAT computation services to our clients to know their actual VAT liability for compliance with relevant VAT laws. We have a strong team of VAT experts, tax advisors, and business analysts who come together to make your tax computation clear and accurate.
Our team of VAT professionals in UAE computes the total output tax for all the sales that you have made in the year. After this, they calculate the total input tax paid to the suppliers during the purchase of goods or services. We put these values in the formula and get the resulting VAT for you that you must pay to the government.
For each of these transactions of sales and purchase, we keep a record of all the evidence such as invoices, receipts, bills, shipping charges, and any other applicable taxes. Such accurate records enable us to calculate accurate VAT amounts for your business. We also have our own UAE VAT Calculator that can help you do the computation for VAT. It also helps to compute VAT with a discount and without discount.
Get in touch with us for accurate VAT computation services in UAE
- We have a strong team of tax advisors and VAT consultants who help you with VAT computation services.
- We help you with good financial management through accurate VAT computation solutions in UAE to avoid law violations and penalties
- We keep ourselves up to date with every new provision of VAT laws and rules. We implement the best industry practices to achieve VAT compliance
Testimonials: VAT Return Filing Service
FAQs: VAT Return Filing Service
What is VAT inclusive price and VAT exclusive price?
VAT inclusive price means the price of the product or service including the VAT amount for each stage of the production and distribution process. The price of a product or service without the VAT amount is VAT exclusive price.
Are the companies dealing in products or services with 0% of VAT required to register for VAT purposes?
Yes, if companies produce and distribute products or services with 0% VAT, then they need to register for VAT. Companies dealing in products or services that are exempt from VAT don’t need registration.
Will you help us in maintaining records of our transactions for VAT computation?
Yes, we provide all VAT services and consultancy to your business for VAT compliance. Furthermore, we assist you maintain the documents, keep records, review transactions, and calculate VAT.