How does VAT work for an interior design and fit-out business?

An interior design and fit-out company usually delivers a bundled service: design, material supply (marble, paint, custom furniture), and execution. All of it is taxed at the standard 5%, but the common mistake is issuing one final invoice at project close instead of tracking the tax point against the contract's own milestone payments — if the contract specifies staged payments, VAT falls due with each milestone invoice, not all at once at the end.

The second issue is that a large share of these projects run through subcontractors for elements like electrical or carpentry work, which needs clear documentation of who invoices whom to avoid double-counting VAT on the same line item. At RASEEKH, we help design and fit-out firms build a milestone-based invoicing structure that matches the actual contract, with every subcontractor documented in a way that keeps the VAT return clean.