VAT Returns in United Arab Emirates

How to set up vat returns in United Arab Emirates

1. 1Confirm your registration position. Mandatory registration applies at AED 375,000 of taxable supplies in the previous 12 months, or expected within the next 30 days, with voluntary registration from AED 187,500 of taxable supplies or taxable expenses.
2. 2Reconcile output tax to revenue and input tax to purchases before you look at the return itself.
3. 3Review blocked input tax and adjustments — bad debt relief, credit notes and capital asset adjustments.
4. 4Generate the return: quarterly for most registrants; monthly once annual taxable supplies exceed aed 150 million.
5. 5File and pay by the deadline — the 28th day of the month following the end of the tax period (vat 201 return and payment due the same day) — then archive the submission with its supporting schedules.

VAT Returns document requirements in United Arab Emirates

• The words "Tax Invoice" must appear clearly on the document
• Supplier TRN and, for B2B supplies over AED 10,000, the recipient TRN
• Sequential invoice number, date of issue and date of supply where different
• VAT amount shown in AED with the exchange rate used if the invoice is in another currency
• Arabic is accepted alongside English; the FTA may request an Arabic version

Returns are filed on EmaraTax: quarterly for most registrants; monthly once annual taxable supplies exceed aed 150 million, due the 28th day of the month following the end of the tax period (vat 201 return and payment due the same day). Imports are handled under the reverse-charge mechanism and pre-populate box 6 of the VAT 201 from customs declarations.

VAT Returns mistakes that cost money in United Arab Emirates

• Missing the deadline. AED 1,000 for a first late VAT return, AED 2,000 for a repeat within 24 months.
• Claiming input tax without a compliant supplier invoice, the most common adjustment raised on audit in United Arab Emirates.
• Filing from spreadsheets that no longer tie back to the ledger, leaving no defensible audit trail.

Penalties applied by Federal Tax Authority (FTA)

• AED 10,000 for failing to register for VAT on time
• AED 1,000 for a first late VAT return, AED 2,000 for a repeat within 24 months
• 14% per annum monthly penalty on unpaid tax, applied from the day after the due date
• AED 5,000 per incorrect or non-compliant tax invoice issued
• AED 10,000 for failing to keep the required records (AED 20,000 on repetition)

Figures reflect the published position of Federal Tax Authority (FTA) and should be confirmed on EmaraTax before you rely on them for a filing decision.

VAT Returns in United Arab Emirates: frequently asked questions