VAT implementation in UAE – key points and deadlines – register NOW
Failure to comply with VAT regulations will lead to serious and costly penalties for businesses, and with the introduction of VAT just around the corner, PRO Partner Group are facing the same recurring question from many of their business partners: how can we effectively prepare for VAT?
We understand that navigating the complex terrain of VAT is a daunting task for any business, so we have compiled a list of key action points that you can do now to smooth the introduction of VAT in January:
Prepare for VAT as soon as possible Much of the legislation is yet to be finalised so businesses will have to react extremely quickly to changes as they are announced
Use available resources The Federal Tax Authority (FTA) have launched an e-services portal: www.tax.gov.ae
Understand when your business needs to register for VAT- Failure to register for VAT will lead to serious penalties
- Businesses with an annual turnover exceeding AED150 million should register for VAT by 31st October 2017
- Businesses with an annual turnover exceeding AED10 million should register for VAT by 30th November 2017
- All other businesses should submit their registration application by 4th December 2017
Carry out a VAT impact assessment VAT will have a significant impact on almost every area of your business. Understanding exactly how each area of your business will be affected by the introduction of VAT is critical to reduce the risk of operating issues in the future.
Determine how to train and prepare staff for VAT
Review all processing and IT systems If an organisation doesn’t have the physical resources to manage VAT then it runs the risk of facing non-compliance penalties and loss of revenue
Carry out a comprehensive audit of the current invoicing and collection systems Identify ways in which to improve the recovery time of VAT on costs
Understand the process of VAT invoices Without a VAT invoice, it is not possible to re-claim VAT which will result in loss of revenue for the business
Review all contracts and agreements with both customers and vendors ensure that VAT has been appropriately addressed
Develop a VAT implementation strategy This will enable businesses to be well-positioned for the introduction of VAT, in terms of compliance, reducing risk, and managing cash flow
Consider leveraging external resources, such as a VAT specialist
Whilst we are still waiting on the final VAT legislation we expect businesses will have to react extremely quickly to changes as they are announced, in order to comply with new regulations. Ensuring that an effective implementation strategy is in place will enable businesses to better prepare for and react to these changes. So do not delay you will need to get the VAT registrations done as soon as possible.
- UAE VAT registration – Key documents and requirements
- Federal Tax Authority’s Service Fees, Administrative Fines
Please contact your relationship manager at PRO Partner group or email us on email@example.com or call a member of the team on:
+971 (0)4 456 1761 (Dubai) +971 (0)2 448 5120 (Abu Dhabi) www.propartnergroup.com