If your business is registered for VAT in the UAE, you must file VAT returns either monthly or quarterly, depending on instructions from the Federal Tax Authority (FTA). During this period, you need to report the VAT you’ve collected from customers, calculate your total VAT liability, and claim any refunds on VAT paid to your suppliers.

If your business pays more VAT (Value Added Tax) than you collect from customers, you are eligible for a VAT refund in the UAE. However, the process of claiming a VAT refund can be complicated, especially for new business owners. Without proper knowledge, delays or rejections can happen, which can hurt your cash flow and overall profitability.

Since VAT was introduced in the UAE, businesses have faced many challenges in staying compliant with regulations related to VAT registration, declarations, inventory controls, and exemptions. Handling daily operations while also managing these tax requirements can make businesses vulnerable to penalties and fines.

There are two types of VAT registration available for businesses in the UAE, and the type you need depends on your company's yearly income.