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How we proceed with VAT Compliance Review?

1. Accounting and operational software system review:Proper accounting software is important in all organisation to ensure that it complies the UAE VAT law which will result in no discrepancy during a tax audit by a tax auditor. Company can check whether the accounting software used in the company is capable of handling proper Tax Invoice, Tax Credit Note, Accouting on Reverse Charge, Calculation of Output Tax and Recording of Input Tax.

2. Review of compliance of Output Tax: Review of calculation of Output Tax includes Whether all taxable supplies at standard rated are charged at respective tax rate and to ensure that only eligible zero-rated supplies are charged as zero-rated and proper supporting documents are maintained, out of scope supplies if any are accounted properly, check whether the goods imported into the UAE through UAE customs are recorded under Reverse Charge Mechanism, to check whether the services if any imported from outside the UAE are recorded under Reverse Charge Mechanism, only the eligible input credit are taken against such import of materials or goods under reverse charge mechanism and exempted supplies if any are recorded and reported properly.

3. Review of compliance of Input Tax: Input tax claimed by the taxable person has to take proper review on eligible input credits on purchases and expenses are claimed, and whether input credit on import of goods and services are calculated and claimed properly to ensure that no discrepancies are detected during the tax audit.

4. Review of periodical VAT returns: Tax experts will review the Vat return files to be submitted to the authority and make sure that the entire output tax payable to the authority are recorded properly, only eligible amount is claimed as input credit, the reporting of output tax under reverse charge are recorded properly, additional reporting such as profit margin scheme, etc., are reported properly and zero rated supplies and exempted supplies are recorded separately.

5. Payment of Tax due amount: to check whether the due tax amount is paid to the tax authority before the due date periodically.