Call for Assistance: +971 503506152
Call for Assistance: +971 503506152
Do exempt supplies count towards the VAT registration threshold in the UAE?
May 30, 2023

No, exempt supplies within the United Arab Emirates do not contribute to the VAT registration threshold.

Exempt supplies are specific goods or services that are not subject to VAT. These supplies do not attract VAT, and businesses making exempt supplies cannot recover input VAT incurred on their related expenses.

Examples of exempt supplies in the UAE include:

  • certain financial services,
  • most medical or healthcare services,
  • residential properties,
  • local passenger transport, and
  • bare land.

In the context of the VAT registration threshold, exempt supplies are not considered when calculating whether a business has crossed the threshold. This means that the value of exempt supplies does not count towards the mandatory registration threshold of AED 375,000. Therefore, businesses that only engage in exempt supplies and do not make any taxable supplies may not be required to register for VAT.

For expert tax advice in the UAE, please get in contact.

more guides

Theta 7 - An Online Accounting Firm in the United Arab Emirates

Spondoo, a leading online accounting firm, has launched Theta 7, its new branch in the United Arab Emirates. Theta 7 is an online accounting firm that offers a range of accounting services to businesses in the UAE, leveraging technology to offer accurate, timely and cost-effective solutions. With its launch in 2023, Theta 7 is set to revolutionise the accounting industry in the UAE.
READ MORE

Taking my clients out for drinks or dinner? How it works in the eyes of the UAE Federal Tax Authority

Most jurisdictions now restrict or disallow client entertainment expenses, and the UAE is no exception to this. When you take a client out for dinner or drinks, or even paying for a joint golfing trip, this is client entertainment. You can indeed pay for this type of expense via the business, and it is still legitimate to do so.
READ MORE

When considering tax rate thresholds, how is UAE corporate tax calculated?

If a company has a taxable profit of 400,000 AED, the calculation will be (375,000 AED x 0%) + (25,000 AED x 9%) giving a tax bill for the period of 2,250 AED.
READ MORE

Is Dubai Truly Tax-Free? 

Simply put - Yes and no: There is no income tax on a person’s salary, wages, bank interest, dividends, or capital gains in Dubai, however, from June 2023 corporation tax was introduced
READ MORE

Can I Avoid Corporation tax by paying all my profits as a salary in the UAE?

Our answer is – it is not that simple, and the FTA (Federal Tax Authority) are too smart for that one.
READ MORE

Are Free Zone companies subject to tax in the United Arab Emirates (UAE)?

It is important to note that Free Zone companies are not exempt from corporation tax in the UAE, but they may qualify for a 0% tax rate. This is an important distinction as all Free Zone companies be required to register for corporation tax with the Federal Tax Authority (FTA) and file returns at least annually.
READ MORE
1 2 3 6
Information provided on the site is merely guidance that may change in line with UAE law and regulations. Users must not consider this to be financial advice or their sole resource when making any financial decision. Theta7 is a trading name for THETA 7 Accounting & Bookkeeping L.L.C, an authorised & licensed accounting firm under the Ministry of Economy and the Federal Tax Authority of the United Arab Emirates.
© Copyright 2023 - Theta 7 - All Rights Reserved
linkedin facebook pinterest youtube rss twitter instagram facebook-blank rss-blank linkedin-blank pinterest youtube twitter instagram