VAT is an indirect tax, a kind of withdrawal to the state budget of a part of the value added, which is created at all stages of the production process of goods, works and services and is paid to the budget as it is sold. The general VAT rate in the UAE is 5%.
Benefits of UAE VAT registration imply that every UAE business registered for VAT can:
- accrue the amount of VAT on all dutiable goods and services it offers;
- refund any VAT paid for the goods and services purchased from other companies;
- monitor all VAT-deductible transactions and inform the government about them regularly.