TaxSavvyAE

Registered late for VAT

My sales crossed AED 375,000 three months ago and I did not register. What happens?

The situation

You had 30 days from crossing the threshold to apply. Late registration carries an AED 10,000 penalty, and VAT is due from the date you should have been registered.

The law

  • Art 13, Federal Decree-Law 8 of 2017: Mandatory registration above AED 375,000 in 12 months or expected within 30 days
  • Cabinet Decision 40 of 2017 as amended: AED 10,000 penalty for late VAT registration

What it means for you

The FTA sets the effective date back to when you should have registered. Example: threshold crossed on 15 July, deadline 14 August, applied 1 November. VAT on sales from the effective date is your cost if you did not charge it, unless contracts let you recover it from customers. Apply now and correct invoices where you can.

What to do

  1. Apply on EmaraTax today with true turnover figures.
  2. Expect an effective date in the past.
  3. Work out VAT on sales since that date.
  4. Ask B2B customers whether they accept VAT invoices for the period.

We can do this for youVAT registration on EmaraTax: threshold test, voluntary registration, non-residents and tax groups: AED 950

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