VAT Registration

Mandatory Registration:
If a Business is exceeding its turnover than  375000 AED/ 37500 in last 12 months or expected to exceed the threshold in next 30 days.

The Person (Individual/company) has to apply for VAT registration as per the guidelines and also notify authorities for the date from which VAT will be applicable.

Voluntary Registration:
The Voluntary Registration Threshold shall be AED 187,500 (one hundred eighty-seven thousand five hundred dirhams). Where a Person applied to register voluntarily in accordance with the provisions of the Decree-Law, the Authority shall register a Person with effect from the first day of the month following the month in which the application is made, or

VAT Return Filing

VAT Return should be filled every quarter as per the guidelines by the end of every quarter.

When a Business performs sales, output VAT has to be collected from consumer.
When a business, buys goods for the purpose of business  Input VAT can be claimed back.

VAT Payable = Output VAT-Input VAT
VAT Returns Filing has to be done through online portal of the Federal Tax Authority (FTA) available under e-services. The form used for VAT return filing is called Form VAT 201. A taxable person is responsible to submit VAT return in the UAE in the prescribed format given by the FTA. Every taxable person is required to submit the VAT Return within 28 days from the end of each Tax period prescribed by the FTA. This must be in accordance with the provisions of the UAE VAT law. The taxable person is also liable to remit the amount of tax due to the FTA within the time frame specified by the UAE VAT Law; ie within 28 days from the end of each tax period.

How do we help you for filing your VAT Return – Form VAT201?

Our Tax professionals in VFM Accounting & Bookkeeping can support you in the following areas:

  • We will visit your office on a periodical basis (weekly/monthly/Quarterly) to compile the information for filing the VAT Return. At the end of each VAT return period, we prepare the VAT return of behalf of your company in accordance with the provisions of UAE VAT law.
  • We ensure that the VAT returns are filed within the specified time in each tax period.
  • Proper guidance for the payment of Minimal Tax Liability as per the provisions of the UAE VAT Law will be advised.
  • Optimal Tax Planning for the company will be done.
  • We will be available to represent in front of the authority on behalf of you as and when required.

How the VAT returns – Form VAT201 – are filed?
VAT Returns are to be filed through online portal of the FTA. One has to access the VAT Return Form by login into the e-services of the FTA portal by using the respective user name and password. Our Tax Expert will help you fill the VAT return form with all relevant information within the due date prescribed by the authority.

What are the information to be provided in the VAT Return?
The VAT return discloses the Tax amount due (or refundable as the case may be) for a particular Tax Period. One has to disclose the total output tax payable as well as the input credit available against such Output separately. Excess of Output Tax over and above the Input Tax for a tax period is the amount of Tax Liability to be paid. The content of the VAT Return Form includes the following:

Output Tax:

  • Tax Liabilities under Standard Rated Supplies (5%).
  • Tax Liabilities on goods imported through customs.
  • Tax on goods imported on which tax liabilities are not created – if any.
  • Tax liability on import of services.
  • Tax refunds provided to tourists.

Input Tax:

  • Tax on Standard Rated purchases
  • Tax on Standard rated expenses.
  • Tax on import of goods
  • Tax on import of services

Tax amount disclosed under Output Tax over and above the Input Tax is the amount to be paid to the FTA for a particular tax period within the due date.

VAT Compliance

VAT can represent a key factor in a business’s cash flow and potentially a real bottom line cost. For finance and tax directors, managing VAT risk and its cash flow implications can be a significant challenge which is often compounded by constantly evolving case law, Statute and FTA guidance. Poor compliance and errors can result in penalties, damaged reputation and/or missed opportunities. Whether you are looking to reduce your VAT compliance risk or mitigate unnecessary VAT loss through structuring VFM have the technical insight and skills to assist.

How we can help
We provide the following VAT compliance services:

  • VAT registration – completion of the required documentation to register (or de-register) your business, company, partnership or group for VAT.
  • Completion of VAT returns – completion of monthly or quarterly VAT returns (based on information provided by you) and submission of those VAT returns
VAT Audit

tax audit is a formal examination conducted by the FTA to verify information or uncover fraud and inaccurate tax returns. The FTA can select tax returns to examine both randomly and intentionally.

The Tax Procedures Law (Federal Decree Law no. 7), issued by the Ministry of Finance defines Tax Audit as a procedure undertaken by the Authority to inspect the commercial records or any information or data related to a Person conducting Business.

FTA may perform the Tax Audit at its office or the place of business of the Person subject to the Tax Audit or any other place where such Person conducts Business, stores goods or keeps records.

What is the Role of a VAT or Tax Auditor during a Tax Audit?
Tax procedures law remarks that the Tax Auditor has the right of entry to the business premises of prior notice of 5 days and can temporarily close the business in order to perform the VAT or Tax Audit for a period not exceeding 72 hours without prior notice if

  • FTA has enough grounds to believe that the Person subject to the Tax Audit is participating or involved in Tax Evasion.
  • FTA has enough reasons to believe that not temporarily closing the place where the Tax Audit is conducted will hinder the conduct of the Tax Audit.

During a Tax Audit, the authority will have the right to obtain any records (original or copy), verify stock or assets of the business where the audit is proceeding or even seize them for the purposes of audit.

It is the duty of the Person subject to a Tax Audit, his Tax Agent or Legal Representative shall facilitate and offer assistance to the Tax Auditor to enable him to perform his duties.

What are the Records to Be Maintained for A Tax Audit?
As per Article (78) of Federal Decree Law states that, a registrant shall maintain the following records to be made available to FTA when asked:

  • Records of all supplies and Imports of Goods and Services.
  • All Tax Invoices and alternative documents related to receiving Goods or Services.
  • All Tax Credit Notes and alternative documents received.
  • All Tax Invoices and alternative documents issued.
  • All Tax Credit Notes and alternative documents issued.
  • Records of Goods and Services that have been disposed of or used for matters not related to Business, showing Taxes paid for the same.
  • Records of Goods and Services purchased and for which the Input Tax was not deducted.
  • Records of exported Goods and Services.
  • Records of adjustments or corrections made to accounts or Tax Invoices.
  • Details of Goods imported to the state along with Customs declarations and Supplier Invoices.

This list is not exhaustive one but just superficial, FTA can demand any further document as they may deem fit during the course of audit to ascertain the tax obligations

What is The Importance of Tax Audit Review in Your Organization?
Federal Tax Authority, the ultimate constitution responsible for collection and management of federal taxes is renowned in efficiently deterring non-compliance from the part of tax payers.

Various laws and regulations issued by Ministry levies severe penalties, including prison sentences and other monetary penalties if a registrant is found guilty of non-compliance.

To avoid falling under the prospect of non-compliance of VAT, it is always better to conduct a Tax Audit review or a VAT health check-up in your organization.

A VAT Audit review targets in finding out disparities in your organizational tax policies and appropriate procedures as per UAE tax laws. It is prudent to say that Tax Audit review is rather a necessity than an option since it’ll reinforce your organization to face a VAT Audit.

VAT Audit review will help you in understanding the causes of non-compliance and address them for the past and the future. It will help you in identifying the areas which require rectification while assuring the accuracy of taxes actually remitted.

FTA has set various options for tax payers to rectify their mistakes before undertaking an assessment such as filing a Voluntary Disclosure or a Reconsideration form as the case requires.

What is VAT Consultancy Service?
VAT Consultancy Service is one of the services that we provide as a VAT Consultant in UAE. Our Service is to provide support and guidance to the registered individuals and businesses for VAT in UAE as per the updates and guidance issued by the FTA. As your VAT consultant in UAE, we will advise and analyse the impact of VAT in your business and guide you to comply with the VAT law. At times of challenges being faced by business we as your VAT Consultant in UAE, can give proper and apt guidance on the process and administrative requirements are every registered individual and businesses must follow.

Why is VAT Consultancy Service Required?
It is very important for the registered individuals and businessesin the UAE to comply with UAE VAT laws and regulations issued by FTA and take necessary action to comply with VAT in UAE. On a regular business, it might be difficult to look into every VAT compliance requirement and also to ensure their completeness too. At this juncture as VAT Consultants in UAE, with our expertise and knowledge in the related field after encountering practical scenarios which we face on a day to day basis, we shall extend our guidance, support, execution and resolution on the all your challenges encountered which will be based on the provisions and guidelines issued by FTA. As VAT Consultants in UAE we will have a ready made cum tailor made tax solutions for businesses in the UAE.