How can Saif chartered accountants help you in VAT?
Our TAX/VAT experts shall visit your office to understand the business model and maintenance of accounts for designing a VAT Implement plan which suits for the UAE VAT Regulations for your type of business activities.
To comply with the UAE VAT Law, we shall advise you regarding the procedural formalities, quantum of turnover which attracts VAT, and the date by which registration has to be made, considering whether the company got any exemption in this respect or not. We shall also advise you regarding the compulsory and voluntary VAT registrations and importance of maintaining proper day to day accounts.
We offer support for preparing and filing of the VAT return by taking the correct input tax credit against the total VAT liability with guidance on planning/better timing of cash flows and within the period allowed for submission of returns as per law.
We review the current accounting systems followed in the company. Proper classification and grouping with appropriate chart of accounts suitable for VAT regime will be suggested.
The requirements of VAT invoicing under the UAE VAT Law will be implemented. Proper guidance will be given to the IT persons and proper training to the Accounts and other departments connected to sales. We shall advise you regarding formatting the invoices as per VAT guidelines.
In order to incorporate the changes in the billing, accounting and other administrative procedures to comply UAE VAT formalities, necessary guidance or information required will be communicated. Our IT department can assist you regarding migration of present accounts package to any other type or advanced levels of the same package.
VAT / TAX overview
Once the VAT implementation starts, the returns should be submitted at the regular periods. The duration for filing is for every quarter of the year.
The registered businesses can file their returns using the online services of the governmental tax related portal. We guide taxpayers to file the value added tax returns too.
The VAT e-filing will be active on the portal of Ministry of Finance. Procedure for filing VAT return in Dubai will be entirely online and no manual returns are accepted by the ministry. The e-services section will offer an option for the VAT return filing. The returns should be filed after every quarter. Delay in filing returns may attract penalties imposed by the tax authorities.
All the registered businesses and individuals should submit the quarterly records of the paid value added tax. Even if you have not paid VAT, you should file the return as Nil if you are a VAT registered company.
The default period for submission of the returns of VAT is 3 months.
The VAT return is nothing but a formal way of reporting the VAT paid during a specific duration. It is to be submitted as per the documents in the record, ledger, and the financial statements.
The main purpose of filing a return is to show the summary of the value added tax to the authorities. Returns are essential for performing auditing by VAT law enforcement activities.
Will all businesses need to register with the government for VAT?
No, not all businesses will need to register for VAT. There will be a threshold limit fixed by the government.
Will all the businesses need to register with the government for VAT?
No, not all the business will be required to register with the government for VAT. Only the businesses, which have a certain minimum annual turnover will be required to get registered for VAT. So, many small businesses will not need to get registered for VAT.
What are the VAT-related responsibilities of businesses?
All the business holders across the country will need to keep the record of their financial transactions accurate and up to date. The businesses, which meet the minimum annual turnover fixed by the government, will have to register for VAT
Will non-residents be required to register for VAT?
Non-residents that make taxable supplies in the UAE will be required to register for VAT unless there is any other UAE resident person who is responsible for accounting for VAT on these supplies. This exclusion may apply, for example, where a UAE business is required to account for VAT under a reverse charge mechanism in respect of a purchase from a non-resident.
How often are registered businesses required to file VAT returns?
Registered users are likely to submit VAT returns on a regular basis. The default time period for filing VAT returns is expected to be three months for a majority of businesses. Registered businesses will be capable of filling their returns using online eServices.
What kind of records are businesses required to maintain, and for how long?
Businesses will have to maintain genuine records so that government authorities will be able to identify the details of the business activities and review transactions. The time period and more details regarding the documents will be announced in due course.
Is VAT applicable in Export?
In the case of exports, VAT will be zero rated.
Will Businesses have to report on their business in each of the Emirates?
It is expected that businesses will need to complete additional information on their VAT returns to report revenues earned in each Emirate. Guidance will be provided to businesses with regards to this.
Will the goods exempt from customs duties also be exempt from VAT?
Not necessarily. Some goods that are imported may be exempt from customs duties but subject to VAT.
What are the implications for businesses that are not ready for VAT by the beginning of 2018?
The implications can be profound. Not being sufficiently prepared to manage VAT by 2018 could see companies failing to comply with the VAT law of the country in which they operate. This could expose these organizations to fines and other enforcement measures, depending on the final version of the law. Some analysts expect tax authorities to be lenient on companies for the first few returns, due to the steep learning curve that they face.
When are businesses supposed to start registering for VAT?
VAT will come into force on 1 January 2018. Any business that is required to be registered for VAT and charge VAT from 1 January 2018 must be registered prior to that date. The electronic registrations will be open for VAT from the third quarter of 2017 on a voluntary basis.
Changing my business systems for VAT reporting will cost money. Can the government help?
When VAT is introduced, the government will provide information and education to businesses to help them make the transition. The government will not pay for businesses to buy new technologies or hire tax specialists and accountants. That is the responsibility of each business.However, provide guidance and information to assist you and giving businesses time to prepare.
How long must a taxable person retain VAT invoices for?
Any taxable person must retain VAT invoices issued and received for a minimum of 5 years.
Will there be bad debt relief?
VAT registered businesses will be able to reduce their output tax liability by the amount of VAT that relates to bad debt which has been written off by the VAT registered business. The legislation will include the conditions and limitations concerning the use of this relief.
Will there be any special schemes for SMEs?
No special rules are planned for small or medium sized enterprises.
Will it be possible to issue cash receipts instead of VAT invoices?
A supplier registered or required to be registered for VAT must issue a valid VAT invoice for the supply. To be considered as a valid VAT invoice, the document must follow a specific format as mentioned in the legislation.
Will there be any VAT that businesses are not allowed to claim?
VAT will not be deductible in respect of expenses incurred for making non-taxable supplies. Furthermore, input tax cannot be deducted if it is incurred in respect of specific expenses such as entertainment expenses e.g. employee entertainment.