Tax Advisory- VAT Support Services in Abu Dhabi
When the concept of VAT was prevailing all around the world, tax in UAE still had no fixed layout due to the option of the free zones. On realising that the implementation of VAT would enhance the brand value of a business and would also be an additional source of revenue for the government, the GCC countries agreed to enter into an agreement for the proper implementation of VAT. The Ministry of Finance, UAE have implemented VAT from 1st Jan 2018 and a tax rate of 5% was decided to be charged.
The accounting standards followed in UAE is defined by the Federal Tax Authority, UAE also known as FTA. This decision of implementing VAT in UAE 2018 was a bold step by the government.
Accounts Compliance for VAT
Tax compliance is a term used in our industry for all services that maintain a client being ‘tax compliant’. It may include preparing accounts, a self-assessment tax return, VAT returns, PAYE reporting, employment status checks, or producing a calculation of a tax liability: that arising on the sale of a business, property or investment asset.
VAT Accounting & Book Keeping
Bookkeeping and accounting are two functions which are extremely important for every business organization. In the simplest of terms, bookkeeping is responsible for the recording of financial transactions whereas accounting is responsible for interpreting, classifying, analyzing, reporting, and summarizing the financial data.Bookkeeping and accounting may appear to be the same profession to an untrained eye. This is because both accounting and bookkeeping deal with financial data, require basic accounting knowledge, and classify and generate reports using the financial transactions. At the same time, both these processes are inherently different and have their own sets of advantages. Read this article to understand the major differences between bookkeeping and accounting.
VAT Registration
UAE, VAT Registration Online
The online registration for VAT in UAE can be done through the VAT registration portal available on the website of www.tax.gov.ae. The steps to be considered while doing an online registration involves filing:
- About the Applicant
- Details of the Applicant
- Contact Details
- Banking Details
- Business Relationship (optional)
- About the VAT Registration
- Declaration
- Review and Submit
Once the application is submitted, the FTA will review the information and documents submitted, and if everything is found to be satisfactory, the application will be approved, and a Tax Registration Number (TRN) will be allotted.
VAT Returns
Value Added Tax (VAT) is charged on the consumption of goods and services. Be it a new business or an established business, filing for VAT return acts as a savior and also holds a good image in the eyes of the government. Today almost more than 180 countries have accepted the procedure and this got spread worldwide at a faster pace. The Middle East countries, especially the United Arab Emirates, which has been tirelessly working on setting itself as a business hub, has understood the importance of VAT filing. Realizing this, the GCC countries have entered the VAT law and agreed at a VAT rate of 5%. If you are building your business plan for UAE, you should be aware of the VAT return filing and VAT related process existing there. Do have a look at the VAT filing terms and processes and why it got accepted at a global level.