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All those companies who have not amended their Memorandum of Association (MOA) before or on the deadlines given by the Ministry of Economy can take a sign of relief as in accordance with the provisions of the new Commercial Companies Law all those necessary amendments has been avoided.
The time at which a supply of goods or services is deemed to take place is called the tax point (Time of Supply). VAT must normally be accounted for in the VAT period in which the tax point occurs and at the rate of VAT in force at that time. Small businesses may, however, account for VAT on the basis of cash paid and received.
New tax law (VAT- Value Added Tax) will present itself in the gulf countries, as UAE is implementing this law from 1st January 2018, there are rules and regulations which is framed by the ministry for the levy of new law as well as there are some VAT rules that people should aware of.
The UAE, along with the other five Arabian Gulf states, including Saudi Arabia and Qatar have agreed to slap VAT and excise taxes as part of measures aimed at surging up the government's income, diversifying government revenues as economies adjust to lower oil prices and ensuring more efficiency in the economy
UAE is welcoming VAT on 1st January 2018 as with the roll-out of VAT (value added tax) in UAE is coming closer businesses as well as individuals is concerned about how this new levy of tax will affecttheir lives and incomes.
The Ministry of Finance, UAE recently proposed the new law that allows them to impose a tax on all goods and services at a standard rate of 5%, and it's called Value Added Tax (VAT).
It is of utmost importance that the companies should aware that the products they are offering are falling under which categories of VAT.VAT is categories under certain categories so each and every category should be clearly understood so to avoid any misconception.
UAE will soon introduce a new taxation system in the form of VAT, confirmed by the Ministry of Finance, UAE. The nation, till now, does not have any enforced federal income tax regulation for general business but with the implementation of VAT with effect from January 1st, 2018, all goods and services would be charged at a standard rate of 5% exempting basic food items, health, and education.
According to the new VAT law which is going to be implemented from 1st January 2018 in UAE, schools don't need to pay VAT, however there is still vulnerability with regards to private schooling foundations. It is still not clear as specialists say greater lucidity is required about how VAT is going to affect private schools and education sector.
VAT will be another wellspring of generating incomes for governments up in the Gulf Cooperation Council (GCC). VAT on rentals for residential or commercial properties in UAE is one of the concerning areas which will go through a big change in new VAT regime.
