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VAT Registration for Amazon Companies in UAE

VAT Registration for Amazon Companies in UAE

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VAT Registration for Amazon Companies in UAE

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  1. VAT Registration for AmazonCompanies inUAE January4,2023 Thanksto thefulfilment programof Amazon,similareCommerceplatforms,andthe simplificationoftheshoppingcarttech,it is nowmadeeasierthaneverforanyonetostarta shop online. You can now run successful eCommerce businesses without having to look for thestorage ofinventoryorevenhavinga website!Moreandmorebusiness-minded people, becauseofthis,aregivingonlinesellingago. However, amidst the excitement and thrill of watching sales and money pour in, it is very important that you remember that an eCommerce business, even on Amazon, has legal obligationsjustlikeanyotherbusiness.ThisincludesValueAddedTaxandyourobligationto undergoVATregistrationinUAE. What is theVATregistrationthresholdfor Amazoncompanies inUAE? When maintaining a physical store, as soon as your business reaches the point in which its turnoveris AED375,000ormoreperyear,youaremandatedbytheFederalTaxAuthorityto undergo VAT UAE registration and include a five percent tax rate to the prices of goods. For eCommerceVAT,ALLgoodsthataresoldonlinearetobechargedwiththestandardVATrate inUAE.

  2. Takenote:youhavetomakesurethatyourtaxregistrationnumberislistedinyourAmazon account or eCommerce website where it’s clear to clients and customers. You don’t have to showabreakdownofVATforeachproductthatyousellonline.Itispossibletojustshowthe pricewiththeVATchargeincluded. • Readmore:VATReturnFilingIssuesInUAE • WhataretheVATchargesfordifferenttypesofsupplymadeoverthe internet? • IntheUAE,themediuminwhichatransactionoccursdoesn’talterthesaleofgoods’taxability. All physical goods that are supplied online attract VAT if the supplier is an entity that is VAT registeredandsupplyaremadewithintheUAE.AguidingprinciplethatyoucanusewithVAT charging for an eCommerce transaction is that it’s the same with traditional commerce. As a VATregisteredbusiness,whenyousellgoodsonlineandthegoodsarewerealreadydelivered locally,that’sastandardratesupplywithafivepercentVATcharge. • A supply of goods that’s made online can be considered as zero-rated if the goods are taken to any non-implementing state outside of UAE.Necessaryexport paperwork has to be maintained for such a transaction. Whether VAT is at five or zero percent on the supply of goodswilldependonthedelivery’sdestination. • For instance, for VATregistered businesses that are selling books on Amazon or any site online,theyhavetochargefivepercent VAT ontopofthebooks’pricewhentheyaredelivered to local destinations. If the books are exported to countries that don’t implement VAT, the supply of books will be zero-rated so long asthe businesses are able to maintain the necessarypaperworkthatprovidessufficientevidenceofexport. • Forgoodsthataresuppliedonlinewhichareexportedthroughcourierorpostalcompany,a VATregisteredbusinesshastomaintainaninvoicetoacustomerfromoverseasandacourier consignmentnoteoraparcelpostingreceipt. • Youmaybeinterestedinreading:VATonResidentialRealEstateintheUAE • ShouldanAmazonbusiness providea taxinvoice? • VATinvoicesarerequiredtobesuppliedforalltransactionsandmaintainedbyVAT registeredbusinesses.Taxinvoicesaretoincludethefollowingdetails: • Dateofissuanceofthetaxinvoice • Words,‘taxinvoice,’displayedonthedocument • Business name, tax registration number (TRN) and address of the VATregistered businessmakingthesupply • Name,TRN,andaddressofthebuyer,ifapplicable

  3. Dateofsupply(onlyifitis adifferentdatefromtheissuanceofthetaxinvoice) • Descriptionoftheservicesorgoodsthataresupplied • Foreveryserviceorproduct,thequantity,volume,andunitprice,thetaxratethat isapplicable,andtheamountthatispayable(shouldbeinAED) • Anydiscountthatisofferedandtheexactamount • Grossamountthat ispayablebytheconsumer(shouldbeinAED) • Findout:VAT RegistrationCost • VATregistrationfor eCommerce in UAE • Registering for VAT in UAE may sound like a complete hassle; however, if you are running an onlinebusinessonlinee.g.throughAmazon’sfulfilmentprogram,thenit is amustforyouto undergo UAE VAT registration. With Farahat & Co, you can rest assured that you won’t have to go through the headache and stress from complying with your tax obligations. Our team of regulated tax agentsin Dubai ishere to help. Whether you are alreadyrunning an established online business or you are still getting your online business off the ground, we will be very happy to provide you with the expert help you need in getting your business in order. • Leaveusamessageorgiveusacalltogetmoreusefulinformationfromourteam ofVATConsultantsinUAE.

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