In the UAE, independent entrepreneurs, including social media influencers, must obtain the necessary licenses and register for VAT when the yearly taxable supply surpasses the 375,000 AED threshold for required VAT registration. UAE's Federal Tax Authority issued a bulletin on VAT for Social Media Influencers (SMIs) and Artists to remind them that they must pay 5 percent VAT if they earn more than Dh375,000 per annum.
Our VAT team at BMS relieves UAE social media influencers of the burden of keeping track of the VAT expense and tax repercussions for social media celebrities.
For years, we've assisted companies with their VAT payments in the UAE, and now we're assisting bloggers with all continuing VAT management duties that undoubtedly come with being successful social media influencers.
VAT Registration for Social Media Influencers in UAE
Social media influencers, Artists & Freelancers in UAE are liable to 5% VAT and should register for VAT for the services or products they sell or exchange. Like any other business, you must completely abide by the tax laws in the UAE if you are an artist, influencer, marketing agency, public relations firm, media production agency, photographer, or any other type of creation.
You must register if your sales in the previous 12 months or in the upcoming 30 days exceed the mandatory level of AED 375,000. If your sales fall below the voluntary threshold of AED 187,500, you have the choice to do so. If you want to register, you will then need to begin charging VAT to your consumers as needed and submit quarterly VAT returns. It's not as difficult as it seems, so don't worry.
We're here to help you out and make this easier. One of the main benefits of registering is that you can now claim the VAT back on all company expenses, with the exception of some leisure costs and vehicle purchase, rental, or lease that also allows for personal use.
Who is subjected to VAT for Social Media Influencers?
The following individuals (influencers & artists) who make supplies in their personal capacity are subjected to paying a 5% VAT exceeding the income of AED 375,000,
- Performers
- Singers
- Dancers
- Stage artists
- Make-up artists
- DJs
- poets
- songwriters
- bloggers
- YouTube hosts or any other individuals carrying out other activities
Not just, influencers and artists, but there is VAT for Ecommerce & Amazon Sellers as well.
VAT For Free Gifts and Products Exchanged with SMIs
Influencers may be avoiding taxes in the UAE by neglecting to report free gifts and experiences. According to the bulletin, influencers must now consider the value of any complimentary items or experiences they get in exchange for their services.
The accepting of commodities in exchange for services, such as phones, is considered as "consideration for the services." When the entire or a portion of the consideration is non-monetary, the supply's worth is the monetary component plus the market value of the non-monetary part, less the VAT amount.
VAT Services for Social Media Influencers and Artists
We, BMS Auditing have compiled a whole set of VAT Services in UAE, offering the most reliable VAT solutions for you. Our services range from VAT registration to VAT compliance which significantly less your VAT complications.
VAT Registration
If you think you are eligible for VAT registration for Social Media Influencers and Artists in UAE, consult our VAT consultants to see your eligibility to register for VAT. We'll also examine whether your company may save money and whether voluntary VAT registration will support your long-term growth and objectives if you're thinking about it. Our professionals would oversee the full VAT registration procedure and evaluation; they would also handle any issues and go over all the important checks.
Filing of Monthly VAT Returns
Even for a business that is registered for VAT in the UAE, filing a VAT return can be difficult. No matter how simple or complex the VAT return is, our professionals in the UAE can assist with its preparation, review, and submission. But VAT returns are submitted under different schemes with diverse frequencies. By ensuring that the danger, difficulties, and bother associated with their VAT return process are removed, we also assist social media influencers and independent contractors in the UAE.
Advisory Services for VAT
VAT can be a burden because it is a hard matter, especially for social media stars. In order to spot problems and concerns before the tax authorities do, our team will offer a VAT health check service. We'll also make it simple for you to continue adhering to local tax laws.
Planning for VAT
We also assist our clients in effectively utilizing the benefits of the reliefs provided by the interpretation of rules. However, based on their knowledge and experience, our regulated tax agents in Dubai and the rest of the UAE are aware of how the FTA works and what goes into the thorough investigations.
Assistance with VAT Implementation
On behalf of the tax authorities in the UAE, a social media celebrity collects VAT from companies. This indicates that it is necessary to provide the sum that customers are charged for services and goods. In order to file accurate VAT returns and pay money owed to the FTA, it is crucial that it be done properly and during a point of sale.
VAT Consultants in UAE
Due to the FTA's clarification of the tax's applicability to the services they render, influencers and artists in the UAE are expected to assess their VAT obligations immediately. Influencers and artists need the help of FTA-approved tax agents in Dubai to assist them with VAT registration, VAT returns filing, VAT accounting and record-keeping, etc. because many of them have been neglecting their VAT requirements.
One of the top VAT consulting companies in Dubai is BMS, which can offer all services necessary to guarantee VAT compliance. Our VAT Consultants are highly competent to reduce the administrative burdens associated with filing VAT registration and returns. To ensure VAT conformity, consult BMS right away.
Our team at BMS offers all kinds of VAT-related services, from helping social media influencers register for VAT in the UAE to settling disagreements over the filing of VAT returns.
What is our expertise in Tax services? we have the best experts gathered to offer top tax solutions in UAE. Our tax team includes
FAQs
1. Do I apply 5% VAT to clients outside the United Arab Emirates when I sell them art or services?
No, the sale would be zero rated if the customer is outside of the UAE and enjoys the service outside of the UAE. This indicates that there is no VAT applied to the sale. You must include this information in your VAT return if you are registered.
2. Should Social Media Influencers in UAE create VAT invoices?
Yes, you must create a tax invoice that complies with all FTA criteria if you are located in the UAE and provide any services to the client in the UAE that are chargeable at 5%. Here is the VAT Invoice Format in UAE
3. I made the decision to offer my services or artwork for free. Is there a VAT impact on something with an AED 50,000 price tag?
Yes. This is going to be considered a deemed supply. You must pay 5% of the cost of the complimentary good or service. The VAT owed in this scenario is AED 2,500.
4. What effects does VAT have on my services offered in the UAE if I don’t live there?
The recipient's status with regard to VAT registration will determine the VAT impact on services provided in the UAE by any artist or influencer who does not reside in the UAE. When the recipient is a registered VAT payer in the UAE, the provisions of the reverse charge mechanism will be in effect, and the recipient will be in charge of recording the applicable VAT in the transaction.
5. What happens if I pass the deadline but don't register for VAT?
For registering beyond the deadline, the FTA will charge you AED 20,000. Depending on when you exceeded the threshold, an effective date of registration will be assigned to you. You will have to submit returns in the past as a result. After that, you will also be subject to a late filing penalty of AED 1,000 for the first return and AED 2,000 for each subsequent return. Additionally, there will be a fee for late payments that can be up to 300% of the total amount due.
