VAT Audit

Are you Prepared for the VAT Audit? Tips for a Stress-Free Compliance

Are you Prepared for the VAT Audit? Tips for a Stress-Free Compliance

All transactions must be recorded with complete information, including TRN, invoice number, customs declarations, revenue and expense figures, along with the corresponding VAT amounts.

Several entities mistakenly consolidate various transactions and document them as a single line item.

Since January 2018, there has been constant talk about the eventual occurrence of VAT audits. However, following the introduction of Corporate Tax in January 2022, attention swiftly shifted from VAT to Corporate Tax. Various CFOs/Tax Heads overlooked certain amendments in the VAT Law in December 2022, granting the Federal Tax Authority the authority to audit a taxpayer for an extended period of four years if the audit notice is issued before the conclusion of the fifth year.

As a result of the extension of the limitation window, many taxpayers are receiving VAT audit notices.

Depending on the complexities, revenue, size, and industry, taxpayers are being issued one of three types of notices:

  1. Covering all tax periods from January 2018 to December 2020
  2. Covering all tax periods from January 2018 to December 2018
  3. Encompassing a sample tax period between January 2018 and December 2020

The audit notification includes a questionnaire that covers fundamental details such as accounting system information, tax advisor details, supplies provided on a free-of-charge basis, bad debts, etc.

Additionally, a transaction data template is provided to capture comprehensive line item details related to supplies (both local and exports), procurements (both local and imports), out-of-scope supplies, etc.

All transactions must be recorded with complete information, including TRN, invoice number, customs declarations, revenue and expense figures, along with the corresponding VAT amounts.

Many entities commonly make the error of consolidating multiple transactions into a single line item, particularly with petty cash expenses. This recording method is incorrect from a VAT perspective.

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VAT Ledgers

Alongside detailed transaction-wise information, submissions must include financials, trial balance reconciliations, group structures, and revenue listings. Another common mistake involves preparing a reconciliation solely for the VAT ledgers. In addition to the ledgers, details of the revenue declared in the financials must be provided.

The purpose is to assess whether the revenues recorded in the VAT return align with those in the financial records.

If discrepancies arise, reconciliations are necessary, involving the segregation of accrued revenue, out-of-scope income, etc., from the amounts disclosed in the VAT return. This substantial task is required for each tax period, ultimately aligning with the audited financials.

In the case of VAT-grouped TRN, this activity must be extended for each taxable entity. The accurate reporting of revenue not only affects the output tax liability but also influences the input tax apportionment for each tax period.

It’s worth noting that, in addition to requesting general information, the FTA is seeking industry-specific details. For instance, a taxpayer involved in real estate is asked to provide beneficial ownership details of infrastructure projects, a list of owned land, ongoing development projects, and details on off-plan units sold.

This information aids the tax auditor in analyzing transactions and the associated tax treatments.

For example, a situation might arise where one entity owns the land, while another entity is responsible for constructing infrastructure on that land. The second entity may be recovering input VAT on construction expenses, leading to complexities such as deemed supply from one entity to another or determining ownership of the infrastructure.

Corresponding Tax Implications

Another consideration is whether the initial supply occurred within three years of the completion date, introducing corresponding tax implications.

The concept of the completion date itself is a separate topic for discussion. Lastly, debates persist over scenarios in which entities operate as disclosed or undisclosed agents. All these situations result in varied tax treatments with retrospective implications.

The FTA has consistently encouraged taxpayers to rectify past errors and ensure tax compliance. It has released over 100 public documents to offer guidance on various tax issues and aid taxpayers.

However, during a review, certain scenarios may arise that necessitate additional clarification. In such instances, taxpayers should prepare a position paper to request private clarification from the FTA.

This serves as another avenue for taxpayers to seek the FTA’s insights on a specific transaction. On average, the process of obtaining private clarification may take approximately 1-2 months in total, so it’s important to consider this timeframe when preparing for it.

The penalties for Voluntary Disclosures underwent a significant reduction (from approximately 300% to about 50%), contingent upon the year in which the error occurred.

Nevertheless, if the correction is made after the issuance of the audit notice, a higher penalty (up to 200%) might be enforced. The aim is to emphasize that taxpayers should prioritize careful attention to tax compliance and governance, rectifying any errors promptly. In cases of delay, the advantage of reduced penalties may not be applicable.

All the details specified in the notice need to be supplied within a span of 10 working days. Given the significant risk of penalties and the restricted timeframe for data submission, it is crucial for taxpayers to promptly evaluate their preparedness.

This involves identifying potential risks, rectifying previous mistakes, emphasizing thorough documentation and data management, and ultimately ensuring readiness for the VAT audit.

The information provided herein is for the general information of the user and is provided in good faith. We make no representation or provide warranty of any kind, express or implied, regarding the adequacy, suitability, validity, or completeness of the information. Our advice in regard to UAE corporate tax and value added tax is based on our understanding of the relevant laws and the regulations issued. We cannot be held responsible for new regulations and/or interpretation of existing regulations by the FTA that is not consistent with our advice. Under no circumstance shall we have any liability to any user of this information or to third parties for any loss or damage of any kind incurred as a result of the use or reliance of this information.

Can I Claim VAT On Old Invoices in UAE

UAE VAT: Can I Claim VAT On Old Invoices in UAE

UAE VAT: Can I Claim VAT On Old Invoices in UAE

Input tax, i.e. VAT paid on the purchase of goods and services is claimable in the tax return by set off against the output VAT collected on sales invoices. In the normal course, input tax should be recovered in the first tax period in which the following two conditions are satisfied:

  • the tax invoice is received; and
  • either the tax invoice has been paid in the period or the taxable person has decided to settle the invoice in a subsequent tax period – usually within six months after the agreed credit period.

Intention to settle the tax invoice:

Where the invoice has not already been settled within the tax period, it is pertinent to consider whether the taxable person has already decided to settle the invoice.

In this regard, merely receiving an invoice is not considered evidence of intention to settle.

However, if the tax invoice has been duly processed through the normal verification and approvals process of the taxable person and has been recorded in their accounting system, this is likely to be seen as a decision or intention to settle the invoice in due course.

It is important, however, to note that where an invoice has been received by the taxpayer, but has not been verified through the relevant processes to determine its validity and suitability for payment, it may not be possible to argue that the taxpayer has formed the intention to settle the invoice.

In such a case, the taxpayer should consider whether the input tax claim should be deferred to a later tax period.

In the case where a taxable person has received a tax invoice but has not yet decided regarding the settlement of the invoice, the Federal Tax Authority (“FTA”) may argue that the two conditions noted above – receipt of the invoice and the settlement of the invoice or the decision to settle – have not been satisfied.

In this case, therefore, it would not be appropriate to claim the input tax on such an invoice. In such cases, therefore, the input tax claim invoice should be made in such later tax period when the decision to settle has been taken.

UAE VAT: Can I Claim VAT On Old Invoices in UAE?

Article 55 (2) of the Federal Decree-Law No. (8) of 2017 on Value Added Tax specifically provides that where input VAT on a tax invoice has not been claimed during a tax period notwithstanding that the taxable person was entitled to make such a claim, the taxable person may claim the tax in the subsequent period.  

Situations may arise where input tax has not been claimed in the tax period when the taxable person was entitled to claim nor in the subsequent period, as provided in Article 55 (2).

In such circumstances, the FTA has clarified that the unclaimed input VAT may be claimed through a Voluntary Disclosure.

Voluntary Disclosure:

A voluntary disclosure is a process where the taxpayer notifies the FTA of an error or omission in a VAT return.

A voluntary disclosure for claiming input VAT would be made by amending the input tax previously reported in the VAT return of one of the two tax periods during which the taxpayer could have claimed the input VAT.

Voluntary disclosures is normally required to be made within 20 business days of the taxpayer becoming aware of the error or omission. However, the FTA may accept late voluntary disclosures if the taxpayer is able to justify the delay by presenting an acceptable reason for the delay.

Do you need help with registering your business for VAT and getting the tax certificate?

Contact us to schedule a free consultation to learn how we can help you to register for VAT and ensure compliance with the VAT rules and regulations.

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A taxpayer that is newly registered for VAT can claim back VAT paid on goods and services purchased prior to its VAT registration, provided that the goods and services for which input VAT is being claimed were used to make supplies that would ordinarily give the right to input tax recovery.

However, input tax may not be recovered in the following cases:  

  1. The goods and services for which input tax is being claimed, were not used for making taxable supplies.
  2. The input tax pertained to capital assets that were depreciated before the tax registration.
  3. In case of services which were received more than five years prior to the tax registration.
  4. where the goods were moved to another country.

Looking For Best VAT Consulting Service in Dubai?

UAE VAT Implementation Services: What We Offer

Do you think that managing VAT obligations is too challenging for your business?

Beaufort Associates provides VAT Implementation Services in the UAE. Our financial consultants are fully qualified and trained to assist you and guide you on the Do’s and Don’ts of the UAE VAT regime.

We offer professional VAT compliance support and advice tailored to your business needs. Our team can help you to comply with the VAT taxation rules and regulations.

Here is what we can do for you:

  • Help you to register with the FTA;
  • Advise you on your reporting deadlines;
  • Provide guidelines to avoid fines and penalties;
  • Provide you with accounting support to ensure proper recording of VAT;
  • Work with you to prepare your VAT tax returns;
  • Arrange to file the VAT tax return with the tax authorities:
  • Assist in filing for a Voluntary Disclosure:
  • Assist in claiming a refund due to you
  • Assist in claiming VAT refund for new residences for UAE Nationals.

We can also assist with corporate tax consulting, accounting and bookkeeping, audit and a host of other services.

If you need help with any of the above services, for your business in the UAE, feel free to contact us today and request a free initial consultation. We would be glad to assist you.

The information provided herein is for the general information of the user and is provided in good faith. We make no representation or provide warranty of any kind, express or implied, regarding the adequacy, suitability, validity, or completeness of the information. Our advice in regard to UAE corporate tax and value added tax is based on our understanding of the relevant laws and the regulations issued. We cannot be held responsible for new regulations and/or interpretation of existing regulations by the FTA that is not consistent with our advice. Under no circumstance shall we have any liability to any user of this information or to third parties for any loss or damage of any kind incurred as a result of the use or reliance of this information.

vat return UAE

VAT Return in UAE: Questions Answered

VAT Return in UAE: Questions Answered

Do you have questions about VAT return in UAE? In this article, you’ll find all the essential information about the VAT return process in the UAE.

What Is VAT Return?

At the end of each tax period, a tax registered person must submit a VAT return to the FTA. It is a report that summarises the value of the supplies and purchases a taxable person has made during the tax period and shows the taxable person’s VAT liability.

A tax return is a written statement that is submitted periodically. It states the details and calculations of tax liability or refund that are to be paid to or received from tax authorities.

If the output tax exceeds the input tax amount, you must pay the difference to the FTA. And if the amount of input tax exceeds the amount of output tax, a taxable person will have excess recoverable input tax. Then that person will be able to set it off against subsequent payments due to the FTA or get a refund from the FTA.

VAT Return Filing

So how can you file a VAT return? VAT return filing must be done online through the FTA portal: eservices.tax.gov.ae. But before you file the VAT return form on the portal, you should make sure you have met all the tax return requirements.

Taxable businesses must file VAT returns with FTA on a regular basis. Usually, they must do it within 28 days of the end of the tax period defined for each type of business. A tax period is a specific time for which the payable tax must be calculated and paid. It differs for businesses of different sizes.

  • If a business has an annual turnover below AED150 million, the standard tax period is every quarter.
  • If a business has an annual turnover of AED150 million or more, the standard tax period is every month.

If you fail to file a tax return within the specified time frame, that will make you liable for fines as per the provisions of Cabinet Resolution No. 40 of 2017 on Administrative Penalties for Violations of Tax Laws in the UAE.

UAE VAT Return Format

The details and data that must be included in the VAT return for the purpose of tax are specified in the UAE VAT executive regulations. All the details that are required for VAT Return must be prepared in accordance with the UAE VAT Return format issued by the authority.

The VAT return form is at a summary level or a consolidated level. The registered person has to enter the following consolidated details of total supplies:

  • both purchases and sales
  • output VAT collected on supplies
  • eligible input VAT paid on purchases
  • the total tax due.

The form also includes details about the name, address, and tax registration number (TRN) of the registrant as well as the VAT Return period and the due date of submission and the tax period. These details are applicable to all VAT registrants and are pre-populated in the online form. In addition to the above-mentioned information, the return format also consists of other additional details:

  • Supplies subject to reverse charge provisions
  • Zero rated supplies
  • Exempt supplies
  • Goods imported into the UAE
  • Profit Margin Scheme applicability
  • Tax Refunds for Tourists Scheme

The registrant may save the online form as a draft and when all the required information has been satisfactorily entered, they may submit the form by clicking the “Submit” button.

How to Submit VAT Return in UAE

As we have already mentioned, VAT returns must be filed electronically through the FTA portal. A taxable person can submit the form themselves or delegate this right to another person who will do it on the taxable person’s behalf. That can be a tax agent or a authorized representative.

So how to submit a VAT return in UAE? To access the VAT return form, you should login to the e-Services portal using your registered username and password. Then you will need to navigate to the option to open your VAT return and fill in all the required details. When you finish, you have to click Submit. After submitting the return, you will receive an e-mail from the FTA confirming the submission of the VAT return form. Finally, you have to pay the due tax.

Dealing with VAT is a tedious, complex, and a rather time-consuming process. And you should remember that taxable businesses should keep their books in a well-organized manner to avoid penalties.

If you find VAT return too challenging, you may need professional guidance.

Contact us to schedule a free consultation to discuss how we can help you to establish a VAT-compliant accounting system.

VAT Return in UAE: Learn How We Can Help You

Beaufort Associates can help you to manage VAT obligations for your business in UAE. You can rely on our team during every stage of the VAT return process. We can advise you on your reporting deadlines to ensure you can avoid fines and penalties. Our highly-qualified and experienced consultants will work with you to prepare your VAT tax returns and arrange the VAT return filing with FTA on time.

If you need professional guidance and support with managing the VAT aspects of your business in UAE, please contact us any time.

The information provided herein is for the general information of the user and is provided in good faith. We make no representation or provide warranty of any kind, express or implied, regarding the adequacy, suitability, validity, or completeness of the information. Our advice in regard to UAE corporate tax and value added tax is based on our understanding of the relevant laws and the regulations issued. We cannot be held responsible for new regulations and/or interpretation of existing regulations by the FTA that is not consistent with our advice. Under no circumstance shall we have any liability to any user of this information or to third parties for any loss or damage of any kind incurred as a result of the use or reliance of this information.

VAT Certificate UAE

VAT Certificate in the UAE: A Comprehensive Guide [2024]

VAT Certificate in the UAE: A Comprehensive Guide [2024]

VAT Certificate is a crucial document for businesses engaged in taxable activities. Issued by the Federal Tax Authority (FTA), this certificate validates a company’s registration for Value Added Tax (VAT). It serves as proof that the business is compliant with VAT regulations and authorized to collect and remit taxes. Displaying the VAT Certificate is mandatory, enhancing transparency in commercial transactions. Timely application and adherence to regulatory requirements are essential to obtain and maintain this certificate, avoiding penalties.

As a VAT consultant, we emphasize its significance for businesses, ensuring seamless compliance and fostering trust in the UAE’s dynamic economic landscape.

What is the VAT Certificate in UAE?

VAT registration is a mandatory step towards obtaining a VAT certificate for companies and individuals doing business in the UAE.

The VAT Certificate UAE is a document that serves as an official confirmation that a business entity is registered under the VAT law for tax collection at every step of product development.

This certificate is the final step in the VAT registration process. The document is issued by the Federal Tax Authority and carries a unique number referred to as Tax Registration Number, often referred to as (TRN), that is evidence of the entity having been already registered for VAT.

You receive it once your VAT registration is completed successfully.

The VAT certificate contains the following important information:

  • Name, registered address and telephone number of VAT registrant
  • TRN number
  • Effective registration date
  • First VAT return period and VAT return due date
  • Start and end dates of tax periods

VAT Registration Certificate: How to Apply

In the UAE, businesses whose annual turnover exceeds the mandatory registration threshold of AED 375,000 and the voluntary registration threshold of AED 187,500 are allowed to apply for VAT registration.

How To Get VAT Certificate From (FTA) Portal

You can do it only online on the FTA portal and after you complete the required registration information, you can apply for the VAT Registration Certificate.

Here is how you can do that.

First, you have to create an e-Service account with FTA. You need to sign up, providing your e-mail details, and create a user name and password.

To apply for VAT registration, you need to login into your e-Service account using your login credentials and click on the Register for VAT button to start the registration process.

You should read the VAT Getting Started Guide to get a better idea of certain important requirements and the information you should have to provide.

You have to follow certain steps – you need to complete the registration form that contains eight sections, such as:

  • About the applicant
  • Details of the business/entity to be registered
  • Contact details
  • Banking details
  • Business relationships (optional)
  • About the VAT registration
  • Declaration
  • Review & submit

You can track your progress as you fill out the form. You need to fill all the section of online form. Keep in mind that you can move to the next sections only when you fill out all the mandatory fields of the current section.

All of them are marked with a red asterisk (*) if one or some of the mandatory fields are not filled out.

The portal is designed to alert you with a pop-up message indicating the relevant fields where you need to enter your details.

When you finish completing the registration form, you need to review all the details in all the sections, verify them, and complete the registration process by clicking the Submit for Approval button.

Remember: you should submit only if you are certain that all of the information is correct.

How To Register For VAT in UAE

VAT registration is not obligatory for all businesses operating in the UAE. However, businesses are required to register for VAT in the UAE if their taxable supplies and imports surpass AED 375,000.

Alternatively, businesses have the option to voluntarily register for VAT if their taxable supplies and imports exceed AED 187,500.

For VAT purposes, the UAE Federal Tax Authority (FTA) defines taxable supplies as:

“A supply of goods or services made by a business in the UAE that may be taxed at a rate of either 5% or 0%. Imports are also considered in this context, if a supply of such goods or services would be taxable if made within the UAE.”

In essence, VAT is collected by businesses from their customers and remitted to the government. VAT-registered businesses can also reclaim any VAT paid to their suppliers from the government.

Required Documents and Forms for VAT UAE

It is imperative to compile the following information in a suitable format and integrate it into your online application:

1. Valid trade license(s)
2. Passport/Emirates ID of the authorized signatory(s)
3. Proof of authorization for the authorized signatory(s)
4. Contact information
5. Bank letter validating the bank account details of the applicant

Depending on the registration basis, additional pertinent documents may be required:

For taxable supplies (applicable to all legal types except Federal and Emirate Government):

– Audit report (audited or non-audited financial statement)
– Self-prepared calculation sheet, including details to compute taxable/zero-rated supplies based on financial records
– Revenue forecast with supporting evidence (e.g., Local Purchase Order or Contract)
– Monthly turnover declaration for specified periods, signed and stamped by the authorized signatory on the entity’s printed letterhead
– Supporting financial documents (e.g., invoices/LPOs/contracts/title deed/tenancy contracts)

For taxable expenses (applicable to all legal types except Federal and Emirate Government):

– Audit report (audited or non-audited financial statement)
– Expense budget report

Additional documents may include:

– Articles of Association/Partnership Agreement (if applicable)
– Certificate of Incorporation (if applicable for Legal Person)
– Documents showing ownership information of the business
– Customs details (if applicable)
– Power of Attorney documents (if applicable)
– Club, charity, or association registration documents and supporting evidence (applicable if you selected “Legal person – Club, Charity, or Association”)
– A copy of the Decree (applicable if you selected “Legal person – Federal UAE Government Entity” or “Legal person – Emirate UAE Government Entity”)
– Other relevant documents providing information about your organization, its activities, and size (applicable if you selected “Legal person – Other”)
– A scanned copy of the Emirates ID and passport of the manager, owner, and senior management
– A scanned copy of the land/property title deed (applicable if you selected “Legal Person – Incorporate/Legal Person – Club or Association/Legal Person – Charity/Legal Person – Federal UAE Government Entity/Legal person – Emirate UAE Government Entity/Natural Person”)

How to Download VAT Certificate in UAE

So how to get your certificate? Here is the Updated procedure.

How to Get a VAT Registration Certificate through EmaraTax?

To get your VAT Registration certificate if you’ve been a taxpayer before, follow these simple steps:

1. Log in to the EmaraTax Platform using your Emirates ID, UAE Pass, or your taxpayer account.

2. Once you’re in the dashboard, you’ll find the VAT registration certificate under the “My Correspondences” section of your Taxable Person account.

3. Click on the certificate, and then download it in PDF format.

Important note: If you’ve used the system before and your tax registration certificate wasn’t previously accessible as a PDF in your dashboard, you won’t find it in your EmaraTax dashboard.

In this situation, to obtain an updated registration certificate, you’ll need to submit a VAT registration amendment application through EmaraTax. This application should include any updated information, such as your trade license, Emirates ID, contact details, and so on. Your registration certificate will be issued once the FTA (Federal Tax Authority) approves your application.

How to download the VAT return in Emaratax?

Currently, the FTA permits the download of an acknowledgment exclusively for submitted returns in EmaraTax.

To accomplish this:

  • Log in to Emaratax.
  • File for VAT Returns, ensuring the inclusion of the necessary documents.
  • Fulfill the payment process.
  • Following the submission of your VAT return, locate the acknowledgment screen.
  • Click and download the acknowledgment screen.

Furthermore, the FTA will dispatch an email to verify the submission of your refund in EmaraTax.

Do you need help with registering your business for VAT and getting the tax certificate?

Contact us to schedule a free consultation to learn how we can help you to register for VAT and ensure compliance with the VAT rules and regulations.

Learn More about What We Offer

You can benefit from our comprehensive management consulting and business advisory services in UAE.

Beaufort Associates has a great team of experienced VAT consultants that can assist our clients in applying for VAT Registration and getting VAT Certificate. We also offer assistance with accounting and bookkeeping.

Our experts are dedicated to providing you with world-class services tailored to the specific needs of your business.

We will provide you with professional advice to help you understand the taxation system and ensure that you always remain compliant with VAT laws in UAE. We also offer the necessary accounting and invoicing guidelines under VAT and support for preparing and filing the first VAT return.

Contact us to request a free initial consultation today!

The information provided herein is for the general information of the user and is provided in good faith. We make no representation or provide warranty of any kind, express or implied, regarding the adequacy, suitability, validity, or completeness of the information. Our advice in regard to UAE corporate tax and value added tax is based on our understanding of the relevant laws and the regulations issued. We cannot be held responsible for new regulations and/or interpretation of existing regulations by the FTA that is not consistent with our advice. Under no circumstance shall we have any liability to any user of this information or to third parties for any loss or damage of any kind incurred as a result of the use or reliance of this information.

how to pay vat in uae

How to Pay VAT in UAE: Everything You Should Know

How to Pay VAT in UAE: Everything You Should Know

Value Added Tax (VAT) is a general consumption tax introduced in the UAE on 1 January 2018 with a rate of 5%, and it applies to the majority of transactions in goods and services. Are you looking for advice on how to pay VAT in UAE? In this article, you’ll find all the necessary information on how to do it right.

Besides, businesses may choose to register for VAT voluntarily if the total value of their taxable supplies and imports (or taxable expenses) exceeds the voluntary registration threshold of AED 187,500.

Here is how it works.

  • UAE imposes VAT on tax registered businesses on a taxable supply of goods or services at each step of the supply chain.
  • Businesses pay the government the tax that they collect from their customers.
  • At the same time, they receive a refund from the government on the tax that they have paid to their suppliers.

VAT Filing in UAE

VAT registered businesses must submit a VAT return to Federal Tax Authority (FTA) at the end of each tax period. VAT filing in UAE is done electronically through the FTA portal. The return can be submitted by the taxable person or another person who has the right to do so on the taxable person’s behalf. For example, you can hire a tax agent or an authorized representative to do it for you.

Taxable businesses must file VAT returns with FTA and pay the tax within 28 days of the end of the tax period as determined by FTA for each business. If that date falls on a public holiday or weekend, it must be submitted on the next working day after the holiday or weekend.

The standard tax period is:

  • quarterly for businesses with an annual turnover below Dh150 million
  • monthly for businesses with an annual turnover of Dh150 million or more.

VAT Submission UAE

The businesses are required to file VAT return online using the Federal Tax Authority (FTA) portal. The FTA Portal is designed to accept the returns only through online mode because offline capabilities to file VAT return through XML and EXCEL are currently not available. That means that taxpayers have to manually provide the values of Sales, Purchase, Output VAT, Input VAT, etc., in the appropriate boxes of the VAT return form available on the FTA portal.

The VAT Return form is named “VAT 201”. You need to fill it and submit it online. The Form VAT 201 has seven sections:

  • Taxable Person Details
  • VAT Return Period
  • VAT on sales and all other outputs
  • VAT on expenses and all other inputs
  • Net VAT Due
  • Additional reporting requirements
  • Declaration and Authorized Signatory

Each of these sections consists of different fields where taxpayers have to provide the details to complete the VAT Tax return filing.

Before submitting the VAT Return, you should take utmost care in verifying all the details. You should click the Submit button only when you are sure that all the information is correct. After the successful filing of the VAT Return, you will receive an e-mail from FTA confirming the VAT Return submission.

Thinking of outsourcing your tax work to ensure that your VAT is calculated correctly?

Reach out to learn how we can help you to establish and implement VAT compliant accounting system and processes.

How to Pay VAT in UAE

If the output VAT in VAT return is higher than the recoverable input VAT, the difference will result in a VAT liability, and it needs to be paid to the FTA. Registered businesses must pay their due tax to the Federal Tax Authority, using one of the following options:

  • locally issued UAE bank credit card
  • bank transfer
  • e-Dirham card

When you make VAT payments using your e-Dirham card at the e-Service portal, you will have to pay a transaction fee of AED 3. A payment using a credit card will typically incur a charge between 2% – 3% of the total payable amount.

It is possible to make partial payments. But you should make sure you pay the entire amount before the due date because there are penalties for late filing of a return or late payment of VAT. Besides, a taxable person may be subject to a penalty if the information submitted in a VAT return is incorrect.

And remember that although tax returns must be submitted and paid electronically, you must keep accounting records and documents relating to business activities properly. That will allow the FTA to check that you have got everything right.  These business records include such documents as the balance sheet, profit and loss account, payroll records, wages, fixed assets, records and inventory statements.

Learn How We Can Help in Filing VAT

Beaufort Associates offers world-class business advisory, management consulting, and VAT consultancy services for businesses in different industries in the UAE. Our experts know all the intricacies of the UAE tax laws and regulations. They can provide you with VAT compliance support and guidance to ensure that your company meets all regulatory requirements.

We will provide you with accounting advice and work with your team to prepare the VAT return. We will also facilitate the filing of the VAT return with the tax authorities after your approval. Contact us for a free initial consultation if you need reliable help to manage your business’s VAT aspects.

The information provided herein is for the general information of the user and is provided in good faith. We make no representation or provide warranty of any kind, express or implied, regarding the adequacy, suitability, validity, or completeness of the information. Our advice in regard to UAE corporate tax and value added tax is based on our understanding of the relevant laws and the regulations issued. We cannot be held responsible for new regulations and/or interpretation of existing regulations by the FTA that is not consistent with our advice. Under no circumstance shall we have any liability to any user of this information or to third parties for any loss or damage of any kind incurred as a result of the use or reliance of this information.

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