Consultancies, agencies and other professional service firms bill for time and expertise rather than physical goods, which changes what good bookkeeping and tax filing look like. VVouch builds accounting around retainers, project fees and time-based billing instead of a product business’s chart of accounts.
Accounting for Fee Based Businesses
Consultancies, agencies and other professional firms sell time and expertise, so their accounts are driven by billing and work in progress rather than stock. We structure your ledger around retainers, fixed fee projects and time based billing, and track unbilled work and deferred income so revenue lands in the right month. Client profitability reports show which clients and services carry the margin.
VAT on Services and Exports
Services to customers inside the UAE are normally standard rated at 5%. Services supplied to customers outside the UAE can qualify for zero rating, but only where specific conditions are met, such as the recipient being outside the country. Our VAT service checks each client contract against those conditions before the return is filed, and monitors your turnover against the registration threshold.
Corporate Tax for Service Firms
A service company in a free zone may earn income that does not qualify for the 0% rate, for example services to mainland customers. Small firms may also benefit from Small Business Relief. Our Corporate Tax team models both so you know your position before the return is due.
Growing the Practice
As a firm grows we add management reporting, budgeting and utilisation tracking, and help with financial advisory for hiring, partner entry and fundraising. For structure and licensing questions, see our business setup support, and for free zone consultancies, read our guides for IFZA and Meydan.
Challenges
- Revenue often comes from a mix of retainers, project fees and time-based billing, which needs consistent tracking to show true profitability.
- VAT treatment on services provided to overseas clients (export of services) has specific conditions that are easy to get wrong.
- Corporate Tax and Small Business Relief thresholds matter more here since many consultancies are smaller entities.
- Cash flow can be uneven between retained and project-based clients, making forecasting harder without management accounts.
How VVouch Helps
- Bookkeeping structured around retainers, project fees and time-based billing.
- VAT advisory on the export of services, including when zero-rating genuinely applies to overseas clients.
- Corporate Tax registration and filing, with an assessment of Small Business Relief where the business qualifies.
- Monthly management accounts and cash flow visibility built for a services business rather than a product business.
