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VAT registration is the formal process by which a business is recognized by the Federal Tax Authority (FTA) as a supplier of taxable goods or services. Upon registration, businesses receive a Tax Registration Number (TRN), allowing them to:

• Collect VAT on taxable goods and services

• Claim Input VAT paid on business purchases

• File periodic VAT returns

• Ensure legal recognition in financial and commercial dealings

Businesses must register for VAT based on their annual taxable turnover:

Mandatory VAT Registration

Threshold: AED 375,000

• Applies if your business has crossed the threshold in the past 12 months or is expected to in the next 30 days.

• Foreign businesses must also register if they make taxable supplies in the UAE.

Voluntary VAT Registration

Threshold: AED 187,500

• Applies if your taxable turnover or expenses exceed this threshold (past 12 months or expected in the next 30 days).

Exempt from VAT Registration

• Businesses not meeting either threshold may choose not to register, but this limits their ability to claim input tax credits.

"Taxable Supplies" include goods or services subject to either 5% standard VAT or 0% VAT. Imports are also considered taxable if they would be subject to VAT if supplied locally.

Entities under common control can apply for VAT group registration, consolidating tax reporting and simplifying compliance. Key benefits include:

• Single TRN for all group entities

• No VAT on intra-group transactions

• Unified VAT return filing

Once registered, businesses must:

• File VAT returns within 28 days from the end of each tax period

• Maintain accurate financial records for 5 years

• Issue proper tax invoices and credit notes

The Tax Registration Number (TRN) is a 15-digit unique identifier issued by the FTA upon successful VAT registration. It is essential for all tax documentation and communication.

To initiate VAT registration, the following documents are typically required:

Business Documents

• Valid Trade License

• Certificate of Incorporation

• Articles of Association / Partnership Agreement

• Proof of business activities and physical location

Authorized Signatory Details

• Passport and Emirates ID

• Proof of authorization (e.g., Power of Attorney)

Financial Documents

• Audited or unaudited financial statements

• Revenue forecast or Local Purchase Orders/Contracts

• Expense budget reports

VAT-Specific Documents

• Monthly turnover declarations (signed & stamped)

• Customs details, if applicable

Failing to comply with VAT obligations can result in severe penalties:

LexVerge ensures your business stays compliant—minimizing penalties and maximizing operational efficiency.

Businesses can apply for deregistration if:

• They no longer make taxable supplies

• Their taxable turnover falls below AED 187,500 (voluntary deregistration)

• They remain below AED 375,000 for 12 months after mandatory registration

Note: Voluntarily registered entities must remain registered for at least 12 months before applying for deregistration.