VAT or Value Added Tax in UAE is charged on most of the goods as well as services. The VAT is collected from the consumer and then paid to the government by the companies which collect the amount. VAT doesn’t add a cost to the business.
However, one must calculate it accurately and VAT Return Filing in a timely manner to avoid penalties. Therefore, it is crucial that VAT accounting is conducted by accountants who know not only accounting but also the requirements of UAE VAT Laws. FTA registered tax agents such as N R Doshi and Partners significantly possess both the skills, and they are best suited to carry out accounting of a VAT registered business.
Our company conducts accounting as well as ensures that all the transactions comply with the VAT Laws in UAE.
VAT Accounting in UAE
It is necessary that VAT records are properly maintained for the VAT charged on sales and VAT paid on the purchase. As per the UAE VAT laws and regulations, VAT accounting requires maintaining a number of records related to supplies made and supplies received, and the VAT amount charged.
It is understandable that these services require dedicated time and resources. Therefore, it is recommended to outsource VAT accounting to a reliable firm that offers dedicated VAT related services.
N R Doshi and Partners is one such firm that has significantly earned its name through years of experience in accounting. In addition to that, we are FTA registered tax agents. You won’t have compliance issues as we remain updated with the FTA laws and regulations.
We can handle all the necessary aspects of VAT. We can calculate the total VAT amount, go through the previous accounts, check them for errors, and also find any need for amendments.
Records to be maintained for VAT Accounting
A taxable business is certainly required to maintain a lot of accounting records as per the VAT Laws. These records can be checked by FTA anytime, making it necessary for a business to exhibit records as per the FTA standards. In case of compliance issues or errors, FTA can put a penalty on the organization. Further, it will also harm the reputation of the company. We assure you that we will be regularly updating all the VAT accounting documents keeping the provisions of VAT Laws into consideration.
- Firstly, outward Supplies and Services Record.
- Secondly, tax invoices or any of the documents which are the proof of inward supplies and services taken by your business.
- Thirdly, records of imported and exported goods.
- Fourthly, tax credit notes
- Fifthly, purchased goods and services records for which you need to recover input tax.
- Sixthly, records of tax invoices corrections
- Seventhly, tax due after the adjustments made
- Eighthly, amount of input tax recoverable on inward supplies
- Lastly, amount of tax due on outward supplies
If you are planning to maintain all the records yourself, consult us before going forward. We can advise you on how you could maintain all the records with the least trouble. However, we would suggest you once go through the benefits of VAT accounting services. These benefits will let you know how our services can support your business.
Significance of VAT Accounting Records
It records should help identify the following to file VAT returns:
- Local Sales
- Export Sales
- Exempted Sales
- Total Sales
- Local Purchases
- Import Purchases
- Total Purchases
Further, accounting information should also be capable enough to maintain and provide the following detail:
- Suppliers as well as Customers master data management with their TRN Number and the place of establishment
- Item master with proper mapping of the tax rate
- Tax coding of various transactions
- VAT Accounting Entries for purchase and sales transactions
- General Ledger
- Lastly, VAT related reports
The period for retaining the VAT Accounting Records
As per the VAT laws and regulations, businesses need to retain all the records for up to five years after the tax period ends.
However, the tax records related to capital assets such as furniture, equipment, etc. are required to be retained for ten years after the tax period. Moreover, the real estate-related VAT accounting records must be kept for fifteen years.
Reliable Tax Agents
Delivering Accurate Work
Our Tax Agents have years of experience in conducting
VAT Accounting for several industries in a number of sectors.
Benefits of VAT Accounting in UAE
One of the significant challenges a taxpayer faces in conducting VAT accounting in UAE is indeed compliance. A business therefore may or may not be fully aware of the compliance rules of it.
When you take the benefit of our services, this will be done as per the standards as our tax agents are fully aware of the FTA rules and keep a track whenever any amendment takes place. Therefore, you will be safe from the penalties that are imposed by FTA when your VAT accounting is non-compliant.
Moreover, the penalties are not limited to monetary harm. When accounting treatment of VAT is not done correctly, it will also harm the company’s reputation.
As you have checked in the previous section, these service requires maintaining a lot of records. Therefore, you need to have dedicated resources and a team. If we provide you these services, you won’t need to maintain an additional team. Instead, you can divert your resources to other aspects of your business, which requires attention.
Penalties for not maintaining proper accounting records
If your business fails to keep the accurate VAT records, then FTA may charge you a penalty of AED 10,000. It is for the first-time offense. If it’s repeated, one needs to pay the fine of AED 50,000.
Moreover, if you fail to produce the proper tax records in the Arabic language when requested by the FTA, you need to pay a fine of AED 20,000. However, if you fail to issue a tax invoice on supplies, FTA charges a penalty of AED 5,000.
As you can see, improper accounting can cause severe financial harm to your business. Therefore, we would suggest that only expert accountants and tax agents perform VAT accounting tasks.
Why Choose N R Doshi and Partners’ VAT Accounting?
N R Doshi and Partners are the experts in VAT accounting. We are certainly into these services since the VAT was introduced in the UAE. Many of our clients, for whom we conduct accounting, took the benefit of our vat accounting in UAE services. Now, along with accounting, we also handle VAT return filing for these clients.
Further, as we are FTA registered tax agents, our skills are exceptional, and our reputation is unmatchable. It took us thirty-five years to build such goodwill in the UAE. We assure you that we always provide our services with complete faithfulness and also aim for client satisfaction.
- FTA registered tax agents having a thorough knowledge of all the aspects of VAT. Our agents have worked with different sectors, making them aware of different process models.
- We have our own proprietary VAT accounting procedures designed to minimize the error as well as maximize the accuracy. The methodology places an additional layer of check on all VAT accounting elements to ensure compliance with the UAE VAT laws.
VAT Accounting Service
with Top-Notch Data Security
We make sure that the company’s
financial data remains safe with us.
Testimonials: VAT Accounting Services
FAQs: VAT Accounting Services
Is VAT Accounting mandatory for every business in Dubai?
No, VAT Accounting is only mandatory for every taxable business registered with the Federal Tax Authority (FTA) in UAE.
Which are some goods and services on which 0% VAT is charged?
Some of the common goods and services on which 0% Vat is charges are mentioned below:
- Telecom Service Exports
- Certain Transports
- International Transportation
- Oil and Gas
- Gold, Silver, and Platinum
What information should be included in a Tax Invoice?
A VAT invoice should include the following information:
- It should be properly mentioned on the invoice that it’s a ‘Tax Invoice.’
- Invoice Date
- Customer name, Supplier name, their address, and TRN
- Description of the goods delivered or services provided
- VAT rate
- VAT amount payable
You Focus on Your Business Growth
And Let Us Handle the VAT Accounting for You