VAT - SERIES 2-A SIMPLIFIED COMPUTATION

VAT Service
2017

COMPUTATION OF VAT ON COLLECTIONS / SALES:

  1. Total Sales on 1.1.2018:    AED 3,150
  2. VAT collected on above:     AED    150
  3. NET SALES on 1.1.2018:      AED 3,000

Formula to calculate is: Total Sales * 100 = 3150*100   = 3000

                                                                        105        

VAT is charged on Sales: so, Sales: AED 3000

VAT @ 5%                         So VAT: AED  150

Therefor Total sales                    : AED 3150

Please Note of this AED 150 is payable to Government as VAT Tax

COMPUTATION OF NET VAT TAX LIABILITY

VAT Collected by your company:

  1. Total Sales on 1.1.2018                   :    AED 3,150
  2. VAT collected on above                   :    AED    150
  3. NET SALES on 1.1.2018                    :    AED 3,000

VAT PAID by your company:

  1. Total Purchases on 1.1.2018             :    AED 2,100
  2. VAT included in purchases                :    AED    100
  3. Net Purchase Value on 1.1.2018       :     AED 2,000

 

VAT Payable to Government : VAT Collected - VAT Paid = VAT Liability

                                              :  AED 150 - AED 100 = AED 50

Please Note of this only AED 50 is payable to Government as VAT Tax

- Renuka G., 
Principal Consultant, 
Centurion Consulting L.L.C., Dubai. 
Centurion Consulting is a business 
consulting firm that assists SME’s 
on VAT advisory, registration, filing, 
inventory management, accounting and auditing. 
 

                                                               

Author: Centurion Consulting