VAT on HR Consultancy Services in The UAE! What’ll Future Be Like?

So many people have started disliking the way they lived after the date of 1st January 2018. This all happened because of VAT in UAE. people think that VAT has started biting them because of its effects. So many people are still not able to get VAT because they are still in shock because of it. all the people knew that VAT is coming their way but they had no idea how it would be like to live in a luxurious place like UAE with VAT in it. This has saddened so many people as it has got implemented on the recruitment services as well.

The recruitment companies in Dubai who provide the people with the services of hiring employees come under VAT as well. nobody might have ever thought that this department will also have to pay VAT. HR Outsourcing in UAE is a new and growing trend these days just like the VAT. Just like everything has negative and positive both aspects, VAT also has some negative and positive aspects as well which we should never overlook

Positives aspects of VAT:

Before January 2018, the economy of UAE was totally dependent upon the revenues generated from oil and gas. The total collection will be about Dh 10 to 12 billion according to the estimate. After the VAT, the economy of UAE will increase and more people will face towards UAE to look for more opportunities

The fear of the people who provide HR services in Dubai is that they think that the HR consultancy services will become too expensive for them but this is not true.

VAT will not be implemented on;

  • Employers and employees who get the salary, bonus packages, gratuity and other payments related to their jobs

  • The building that will be given on lease

  • Services of education that are provided to the people (school)

Effect of VAT on HR Services:

The people who provide HR services to the asses will be subjected to 5% VAT. The businesses will have the leverage to get the input credit tax so the effect of VAT on the businesses will not be so much. So, there is nothing to worry about here.

So many confusions!

there are so many things that are still unclear to so many people. the reason behind it is that VAT is a bit too NEW in UAE. People will learn about it with time and experience. All their ambiguities will get cleared after some time. Then and only then they will understand the importance of VAT For UAE.

VAT has no major impact on your business

People think that VAT will have a major impact on their businesses but this is not what it is actually like. VAT has no major effects on the HR and business services.

VAT is different for different people

For different cases, scenarios of VAT get changed a bit. So, if you need to have legal advice regarding VAT, you must contact the firms who provide the legal services in UAE.

For more information click here.

About RJ Frometa

Head Honcho, Editor in Chief and writer here on VENTS. I don't like walking on the beach, but I love playing the guitar and geeking out about music. I am also a movie maniac and 6 hours sleeper.

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