Value Added Tax is recently imposed in the United Arab Emirates along with many other Gulf States. It has considerably changed the taxation outlook of the country owing to a brand new requirement to comply with the laws set by the Federal Tax Authority. Owing to the novelty and complexity of the newly imposed tax, the probability of mistakes is relatively higher during VAT registration.
Keeping this in view, the article is written to help businesses deal with intricacies of VAT submissions. So, read the article till the end to get a fair idea of all you need to know about VAT to avoid potential mistakes.
Deadly VAT Mistakes UAE-Based Businesses Should Avoid
Nevertheless, the VAT process is new to all the businesses operating in the UAE. Further, the division of VAT-exempt, Zero VAT and VAT paying add more to the complexities. The better way to avoid all this is to hire the best VAT consultancy in Dubai based services for complying with all the requirements. It is because you can get the things done by professionals with diverse industry experience.
Besides this, you should have complete knowledge to deal with the future needs of your business. So, a list of most critical yet probable mistakes is given below:
Not maintaining comprehensive bookkeeping
If you are running a business in the UAE but ignoring to focus on bookkeeping, you are making a big mistake. It is owing to the reason because the VAT filling considerably depends on the record-keeping of your business. You will have to provide evidence of all your business transactions to make financial statements.
Beware! You must keep everything in the book of transactions and entry journals to ensure effective compliance with all VAT obligations.
Delaying the submission of VAT returns
While dealing with the updated system of taxation, the business should be on-time with everything starting from registration to the submission of value-added tax. Most of the companies lag behind the due dates owing to lack of proper information about VAT. You should be aware of the consequences of such things in order to avoid it.
Don’t let the late submissions cost you a fortune, be pro-active in returning VAT according to your deadlines!
Not maintaining a system of VAT invoices
As already said, the business companies have to maintain detailed bookkeeping and record management journals to note down everything related to finances. However, entering the fact and the figure cannot work successfully without keeping the invoices along with it.
So, you have to issue proper invoices for all your business transactions to complete the records for VAT. So, hiring VAT professionals can help you do this with optimization. Be ready to do this in time!
Not paying attention to non-deductible VAT
Value Added Tax is not applicable to all goods and products and here comes the real trouble. It is because the businesses have to keep the record based on payable VAT and non-deductible VAT. Don’t forget to consider the rules and regulations about completing registrations and the submission process for VAT compliance successfully!
Worried about VAT mistakes? Get Instant Solutions
Summing up, the imposition of value-added tax in the UAE has helped in ensuring good governance in the commercial business sector. For this reason, the companies should join hands with the state to stay ahead in the game of competition within the market. The primary reason for compliance is that business companies get the opportunity to optimize their financial resources for better business management.
Are you not aware of complications of VAT? You may take assistance from the Best VAT consultancy in Dubai based companies to exclude the finances that are not included in the payable tax. It is because professionals know the critical aspects to deal with in a better way.
Remember, VAT filing is an essential task to be accomplished by the business, particularly in the UAE. Don’t forget to make the process flawless for higher business success!