VAT Registration Threshold Calculation:
To determine whether a Person has exceeded the Mandatory Registration Threshold and the Voluntary Registration Threshold, the calculation should be made as follows:
1. The value of Taxable Goods and Services. +
2. The value of Concerned Goods and Concerned Services received by the Person unless covered in above point. +
3. The value of the whole or relevant part of Taxable Supplies that belong to said Person if he has, wholly or partly, acquired a Business from another Person who made the supplies. +
4. The value of Taxable Supplies made by Related Parties pursuant to the specified under the UAE VAT Law and rules & regulations made the there under from time to time
It should be noted that the supply of Capital Assets belonging to the Person shall not be taken into account to determine whether a Person in Business exceeds the Mandatory Registration Threshold or Voluntary Registration Threshold.
To determine whether a Person has exceeded the Mandatory Registration Threshold and the Voluntary Registration Threshold, the calculation should be made as follows:
1. The value of Taxable Goods and Services. +
2. The value of Concerned Goods and Concerned Services received by the Person unless covered in above point. +
3. The value of the whole or relevant part of Taxable Supplies that belong to said Person if he has, wholly or partly, acquired a Business from another Person who made the supplies. +
4. The value of Taxable Supplies made by Related Parties pursuant to the specified under the UAE VAT Law and rules & regulations made the there under from time to time
It should be noted that the supply of Capital Assets belonging to the Person shall not be taken into account to determine whether a Person in Business exceeds the Mandatory Registration Threshold or Voluntary Registration Threshold.
Important concepts in relation to VAT Registration Threshold Calculation in UAE :
What is Mandatory Registration Threshold ?
An amount specified under the UAE VAT Law and rules & regulations made the there under from time to time; if exceeded by the value of Taxable Supplies or is anticipated to be exceeded, the supplier shall apply for Tax Registration. Currently the specified amount is AED 375,000 ( AED Three Hundred Seventy Five Thousand).
What is Voluntary Registration Threshold ?
An amount specified under the UAE VAT Law and rules & regulations made the there under from time to time; if exceeded by the value of Taxable Supplies or is anticipated to be exceeded, the supplier shall apply for Tax Registration. Currently the specified amount is AED 187,500 ( AED One Hundred Eighty Seven Thousand Five Hundred)
What is Taxable Supply ?
A supply of Goods or Services for a Consideration by a Person conducting Business in the State, and does not include Exempt Supplies.
What is Exempt Supply ?
A supply of Goods or Services for Consideration while conducting Business in the State, where no Tax is due and no Input Tax may be recovered except as specified under the UAE VAT Law and rules & regulations made the there under from time to time.
Who is a supplier ?
A supplier is a person or business that provides a product or service to another person or business.
What is consideration ?
All that is received or expected to be received for the supply of Goods or Services, whether in money or other acceptable forms of payment.
What is business ?
Any activity conducted regularly, on an ongoing basis and independently by any Person, in any location, such as industrial, commercial, agricultural, professional, service or excavation activities or anything related to the use of tangible or intangible properties.
What is concerned Goods ?
Goods that have been imported, and would not be exempt if supplied in the State as per the UAE VAT Law and rules & regulations made the there under from time to time. .
What is Concerned Services ?
Services that have been imported, where the place of supply is in the State, and would not be exempt if supplied in the State as per the UAE VAT Law and rules & regulations made the there under from time to time.
What is Capital Assets ?
Business assets designated for long-term use.
What is Mandatory Registration Threshold ?
An amount specified under the UAE VAT Law and rules & regulations made the there under from time to time; if exceeded by the value of Taxable Supplies or is anticipated to be exceeded, the supplier shall apply for Tax Registration. Currently the specified amount is AED 375,000 ( AED Three Hundred Seventy Five Thousand).
What is Voluntary Registration Threshold ?
An amount specified under the UAE VAT Law and rules & regulations made the there under from time to time; if exceeded by the value of Taxable Supplies or is anticipated to be exceeded, the supplier shall apply for Tax Registration. Currently the specified amount is AED 187,500 ( AED One Hundred Eighty Seven Thousand Five Hundred)
What is Taxable Supply ?
A supply of Goods or Services for a Consideration by a Person conducting Business in the State, and does not include Exempt Supplies.
What is Exempt Supply ?
A supply of Goods or Services for Consideration while conducting Business in the State, where no Tax is due and no Input Tax may be recovered except as specified under the UAE VAT Law and rules & regulations made the there under from time to time.
Who is a supplier ?
A supplier is a person or business that provides a product or service to another person or business.
What is consideration ?
All that is received or expected to be received for the supply of Goods or Services, whether in money or other acceptable forms of payment.
What is business ?
Any activity conducted regularly, on an ongoing basis and independently by any Person, in any location, such as industrial, commercial, agricultural, professional, service or excavation activities or anything related to the use of tangible or intangible properties.
What is concerned Goods ?
Goods that have been imported, and would not be exempt if supplied in the State as per the UAE VAT Law and rules & regulations made the there under from time to time. .
What is Concerned Services ?
Services that have been imported, where the place of supply is in the State, and would not be exempt if supplied in the State as per the UAE VAT Law and rules & regulations made the there under from time to time.
What is Capital Assets ?
Business assets designated for long-term use.
