BACKGROUND OF VALUE ADDED TAX (VAT) IN UAE

• H.H. Sheikh Khalifa Bin Zayed Al Nahyan, President of the United Arab Emirates issued Federal Decree-Law No. (8) of 2017 on Value Added Tax.
• VAT in UAE is applicable from 1st January 2018 and registration for VAT is being handled through Federal Tax Authority (‘FTA’) portal i.e. tax.gov.ae.
• As per Article (3) of Decree-Law standard VAT rate in UAE is 5% on taxable supplies and import of goods and services.
• Other GCC countries also are being implementing VAT in their region, so far KSA & Bahrain has implemented VAT in their region

OUR VAT CONSULTANCY SERVICES

We provide VAT Advisory, tax optimization, implementation, and training services in the UAE and India. We have a team of senior qualified tax advisors, finance experts, and tax accountants will ensure a timely and cost-effective VAT services for SME’s as well as for large corporate houses.

We have a four-phase strategy to assisting our clients to comply with regulations:

Phase I- Pre-Assessment of Business

• Assessing the VAT readiness of the entity and identifying the gaps in existing system
• Analysis of IT system and accounting requirements
• Identification and analysis of the VAT impact on your business
• Studying the impact on working capital
• Review of contractual arrangements with customers and suppliers
• Outline the VAT registration obligations

Phase II- VAT Implementation

• Outlining the and steps for applying for a VAT registration number
• Provide assistance with registration of business entities individually or as a group
• Mapping of transactions based on the VAT Law
• Assist in aligning business practices with VAT regulations:
  • By ensuring that the relevant books and records are maintained in the appropriate and compliant manner
  • By ensuring that the accounts payable function evidences the correct Input VAT
  • Ensuring that the accounts receivable function understands when Output VAT should and should not be charged and it is accurately accounted for at the correct rates
• Update of the invoice templates to ensure that all relevant information for VAT Invoices are included
• Ensuring that business is structured in such a manner to avoid unnecessary cash outflow, or absolute VAT costs arising
• For small SMEs, we can facilitate a set-up of a simple accounting systems and implementation of VAT rules, through our outsourced accounting services.
• For larger SMEs, we can guide your finance team with the implementation and provide outsource CFO or Finance Manager services on a monthly basis in order to strengthen your existing team.

Phase III- VAT Compliance

• Preparation and filing the VAT returns
• Assistance in claiming VAT refunds

Phase IV: Post VAT Implementation Support

• Advise on the application of the rules, especially on available exemptions, VAT treatment of intra-GCC transactions, imports and exports
• Assessment of the VAT implications relating to: new business models, elaborated supply chains, asset purchases and transfers, M&A, etc.
• Provide guidance for industry-specific transactions, international transactions

• Organize and provide training to the finance, sales and management of different entities catering to specific industries. Our training package covers the following key areas:

• Applicability of VAT for the business (Relevant provisions pertaining to the business are discussed)
• Recording of VAT related transactions
• Accounting for reverse charges
• Preparation & submission of return
• Maintenance of accounting documents & other supporting documents

Phase V: VAT Reconsideration and Private Clarifications

• Advise and filing of application of filing of Reconsideration forms for penalty waiver.
• Assessment of the VAT implications relating to: new business models, elaborated supply chains, asset purchases and transfers, M&A, etc.

If you are looking for VAT consultancy, advisory and implementation services in UAE and GCC, please get in touch with us today.