- Introduction to VAT in UAE
- VAT Software
- Introduction to Tax system
- Frequently Used Terms in Indirect Tax System
- How VAT System Works
- VAT in UAE
- VAT FAQs on implementing VAT in your business
- VAT Registration
- VAT Registration in UAE
- Who should register under VAT
- Apply for VAT registration in UAE
- VAT registration Deadlines in UAE
- VAT Registration Threshold Calculation in UAE
- VAT Group Registration
- Tax Registration Number (TRN)
- How to check TRN validity in UAE
- How to link Tax Registration Number (TRN) with Dubai Customs
- How to register as a Tax Agent under UAE VAT
- How to register as Tax Agency
- How to de-register under VAT in UAE
- How to de-register or amend a Tax Group under VAT in UAE
- Online Amendment or Change in Registration Details in UAE VAT
- Amendment of details which are blocked for Online Modification
- Input Tax Recovery
- Input Tax Recovery under VAT in UAE
- Supplies not eligible for input tax recovery under VAT in UAE
- Your Checklist for Input VAT Recovery under VAT in UAE (Downloadable)
- Is the Input VAT paid prior to Registration, claimable?
- List of business expenses on which input VAT is blocked
- Apportionment of Input Tax
- Capital Asset Scheme in UAE VAT
- Input VAT Adjustments under Capital Assets Scheme
- VAT Fundamentals
- Supply under UAE VAT
- Supply of Goods and Services in UAE VAT
- VAT Rate in UAE
- UAE VAT Rates- Handbook
- Zero-Rated Supplies in UAE VAT
- Difference between zero rate, exempt and out of scope supplies in UAE VAT
- Accounts and Records under VAT
- VAT FAQs on Education Sector in UAE
- VAT support channels by FTA in UAE
- What is FTA Audit File (FAF)?
- FTA Accredited Tax Accounting Software Requirements
- Benefits of using FTA Approved Tax Accounting Software in UAE
- Special VAT Refund Schemes in UAE
- Change in business details to be notified to FTA
- Administrative Penalty under VAT in UAE
- Administrative Penalties under Tax Procedures Law by FTA in UAE
- VAT Exempt Supplies in UAE
- What is Time of Supply
- How to Determine the Time of Supply for Goods
- How to Determine the Time of Supply for Services
- Time of Supply in case of Assembly or installation of goods
- Time of supply for Sale on returnable basis or Consignment Sale under VAT in UAE
- Time of Supply in case of continuous supplies or Progressive billing under VAT in UAE
- How to Determine the Value of Supply in UAE VAT?
- Time of Supply in case of supplies through Vending Machine
- What is Deemed Supply under VAT in UAE?
- Deemed Supply Exceptions under VAT in UAE
- Date of Supply, Value of Supply and Invoice for Deemed Supply in VAT
- Single Composite Supply in UAE VAT
- Output VAT adjustments
- VAT Reverse Charge Mechanism
- VAT calculation when price is inclusive of VAT
- VAT rates applicable to Education Sector in UAE
- How to Treat Discounts under VAT in UAE?
- VAT applicability on different types of supplies in UAE
- Profit Margin Scheme under VAT in UAE
- How to calculate VAT under Profit Margin Scheme
- Valuation of supply when consideration is not in money
- How to handle Multiple Supplies in UAE VAT
- Tax Agent under UAE VAT
- Difference between place of establishment, fixed establishment and place of residence
- New residence VAT Refund Scheme in UAE
- VAT on supply of real estate in UAE
- VAT on supply of commercial property
- VAT FAQs on supply of real estate in UAE
- VAT on supply of bare land
- VAT on supply of charitable buildings
- VAT on supply of Residential Buildings
- VAT on owners’ associations
- Identifying VAT applicability on supply
- VAT on supply of mixed use developments
- Bad Debts Adjustment in UAE VAT
- VAT on gold and diamonds business in UAE
- Conditions for applying reverse charge VAT in Gold and Diamond Business
- Place of Supply
- Place of supply of goods under VAT in UAE
- Place of supply in case of export of goods
- Place of supply of specific goods
- Place of supply of services
- Bill–to Ship-to Supplies in UAE VAT
- Place of supply of real estate under UAE VAT
- VAT Invoice and Billing
- VAT Invoice in UAE
- Tax Invoice under VAT in UAE
- Simplified Tax Invoice under VAT in UAE
- Checklist for a Tax Invoice under VAT in UAE (Downloadable)
- How to issue Tax Invoice to registered customers?
- How to issue a Tax Invoice to unregistered customers?
- What consumers must check in a Tax Invoice in UAE?
- Credit Note: Document for return of goods under VAT in UAE
- Tax Credit Note under VAT in UAE
- VAT Compliance and Return
- VAT Return Filing Period in UAE
- VAT Return in UAE
- VAT Return Form
- How to file VAT Return in UAE
- - How to Furnish Standard Rated Supplies in VAT Return Form 201
- - Tourists Refund details in VAT Form 201
- - Reverse Charge Supplies in VAT Form 201
- - Zero-Rated and Exempt Supplies in VAT Form 201
- - Goods Imported into UAE and Adjustments to goods imported into UAE
- - Standard Rated Purchases/Expenses in VAT Form 201
- - Input VAT Recovery for Reverse Charge Supplies in VAT Form 201
- - Input VAT Adjustments in VAT Return Form 201
- VAT return FAQ's
- Checklist for Tax Return Filing under VAT in UAE
- Form 211 - VAT Voluntary Disclosure
- Penalties levied on Voluntary Disclosure in UAE
- How to Claim VAT refund under VAT in UAE
- Business VAT Refund Scheme in UAE VAT
- VAT Payment in UAE
- How to make VAT payment using GIBAN
- How to make VAT Payment to FTA in UAE
- VAT payment on commercial property in FTA Portal
- Tourist Refund Scheme in UAE
- Free Zones and Designated Zone
- VAT on Free Zones in UAE
- New VAT Free Zones in UAE VAT
- VAT on Designated Zone in UAE
- VAT Computation on Goods Supplied from Designated Zone in UAE
- VAT Computation in case of Services supplied from Designated Zone in UAE
- VAT Treatment on Purchase of goods into Designated Zone in UAE
- VAT Treatment on services received in Designated Zone in UAE
- VAT FAQ's on UAE Free Zone
- Export and Import
- Exports and Imports under VAT in UAE
- Export of goods under VAT in UAE
- Export of goods to GCC VAT implementing States
- UAE Exports of goods from UAE to Non-GCC VAT implementing States
- UAE Exports of services to outside the GCC Territory
- VAT Payment on Import of Goods in UAE
- VAT Payment on Import by unregistered person in UAE
- Value of Supply in case of Import of Goods in UAE
- VAT on goods under customs duty suspension
- No VAT on import of these Goods
- VAT payment through e-guarantee in UAE
- Steps to submit e-guarantee in FTA portal
- Steps for non-registrants to pay VAT on import in FTA portal
- e-guarantee cancellation in FTA portal
VAT Payment in UAE
VAT Payment in UAE refers to payment of tax collected by the VAT registered businesses to the government. From 1st January, 2018 onwards, the businesses registered in UAE VAT are required to charge VAT at 5% on the taxable supply of goods and services. Similarly, when they purchase goods or services from their supplier, they have to pay VAT at 5%.
It is a known fact, that the VAT collected by the registered businesses is required to be paid to the government, but how much is the question? Should one pay the entire amount of VAT collected on sales? Is there any method to arrive or determine the VAT payable to the government?
No worries! We will be answering all of these questions for you in detail.
Before we start answering the questions, let us understand what is 'Output VAT' and 'Input VAT' which will help us to determine the VAT payment to the government.
Output VAT is the amount which is collected by you on making taxable sales. On the other hand, Input VAT is the amount paid by you for making the taxable purchase from your supplier. The Input VAT amount paid by you will be in turn paid to the government by your supplier. As a result, the government gives the benefit of input VAT to the recipient or the buyer and allows him to adjust the Input VAT amount with Output VAT and pay the remaining. You might be interested to read 'How the VAT System works' to know more about this.
Alright! While this sounds to be too good, there are certain conditions and restrictions for making claims on your input tax.
By now, most of the above questions on VAT payment would have answered but to make it clearer, let us discuss in detail.
Method to Determine VAT Payment in UAE
The formula to determine VAT payment in UAE is very simple. All you need to do is calculate your total Output VAT collected during the tax period and total Input VAT which you are eligible to recover. After determining, apply the following formula:
VAT Payment = Output VAT - (minus) Input VATExample of VAT Payment,
The Output VAT and Input VAT of Rose General Stores is given below
| Output VAT | AED 300,000 |
| Input VAT | AED 200,000 |
The VAT payment of Rose General Stores is determined by adjusting the Output VAT with Input VAT as shown below:
Output VAT AED 300,000 * (Minus) Input VAT AED 200,000 = AED 100,000 is VAT payable which need to be paid to the government. This looks so easy to determine the VAT payment.
WAIT! What happens if Input VAT is more than Output VAT?
Yes, it is the right question. In some situations, your Input VAT might be higher than the Output VAT. In such a situation, it will result in VAT refundable which can be carried forward to the next return period and will be allowed to be utilized against your future VAT liabilities.
VAT Payment Online
The VAT payable determined after off-setting the Output VAT with Input VAT needs to be paid through the FTA portal. The Online VAT payment facility will be provided in the FTA portal, wherein the registered businesses can remit the VAT payable.
