Map out obligations related to local VAT rules and regulations. Identify and analyze the impact VAT has on your business. Review and amend your contracts with customers and suppliers. Adopt your business processes, bookkeeping, HR and IT systems to avoid net VAT costs and penalties.
Maintain books and records ensuring that the accounts payable record VAT inputs that are paid and recovered where permitted as soon as possible. Ensure that the accounts receivable reflect and charge VAT outputs appropriately at the correct rates. Update invoice templates to ensure that all relevant information for VAT is included.
Register for VAT with relevant government authorities and obtain your VAT number. Prepare and file VAT returns in accordance with approved processes and practices. Claim and receive VAT refunds on a timely basis. Make use of available VAT exemptions and special treatments on imports and exports. Be up to date with changes in VAT regulation.
What is VAT?
Value-Added Tax or VAT is a tax on the consumption or use of goods and services levied at the point of sale.
When VAT will go into effect?
VAT is introduced in all GCC member states – UAE, KSA, Kuwait, Bahrain, Qatar, Oman – on January 1, 2018.
What is VAT rate?
VAT will apply to goods and services at the standard rate of 5% across all GCC countries.
Who needs to register for VAT?
Businesses with annual revenue of more than AED 375,000 UAE or SAR 375,000 equivalent in taxable goods or services will be required to register for VAT.
How do I administer VAT?
All businesses need to document their transactions, including income, costs and associated VAT.
What are the penalties for VAT non-compliance?
Exact fees and penalties for not complying with VAT laws are still being defined by regulators but expected to be substantial.
Include VAT in your invoices at appropriate rate for your customers and suppliers.
Charge, pay and recover VAT with Accounts Payable and Accounts Receivable.
Record and file statutory and managerial financial reports with VAT included.