Know Everything about Audits and the Quarterly VAT Return in UAE

It is almost a year since the business communities in the UAE are familiarised with the word ‘VAT Audit’. It is essentially a compliance check conducted by the Federal Tax Authority (FTA) to verify that the VAT liability is correctly assessed and the tax return is accurately filled by the taxpayers. It could be carried out at the business premises of the company or in the offices of the FTA.

In the UAE, the standard VAT return filing period is on a quarterly basis. However, FTA may request certain types of businesses to file the VAT return on a monthly basis. This is majorly done to eliminate the risk of tax evasion and at the same time to improve the monitoring of compliance adherence by the businesses. The VAT return filing period applicable to each taxpayer is available on the FTA portal.

• The VAT Return Filing Process

Taxpayers need to fill the form – ‘VAT 201’ for the completion of VAT return filing process. In order to fill the form, you have to log in to the E-services portal of FTA and select the option of ‘VAT’ followed by ‘VAT 201’ and ‘VAT Return’.

• Taxable Person Details

You have to enter your name, address and Tax Registration Number in this section.

• VAT Return Period

You have to enter your VAT return period here. Further details like tax year end, due date, etc. will be generated automatically.

• VAT on Sales and All Other Outputs

Here you have to compile the details of taxable supplies at Emirates level, supplies subject to reverse charge mechanism, zero rate supplies, exempt supplies, etc.

• VAT on Expenses and All Other Inputs

Here you have to compile the details of expenses or purchases on which you paid 5% VAT. Also, include the input tax that has to be recovered.

• Net VAT Due

This is the VAT payable for the return period.

• Additional Reporting Requirements

If you have used any profit margin scheme or have applied for the same, you need to fill in this section or else you can leave it by clicking on the ‘No’ option.

• Declaration and Authorised Signatory

Here you have to provide the details of authorised signatories and then click on the submit form tab.

Things to Take Care of While Filing VAT Return

• All the amounts mentioned in the return should be in United Arab Emirates Dirhams (AED) currency.
• All the amounts mentioned in the return should be rounded off to the nearest figures of the fills.
• The sections marked mandatory should be compulsorily filled.
• If there is no amount to be declared, use ‘0’.

The Bottom Line

Submitting incorrect VAT return or furnishing wrong details can attract huge penalties. Therefore, it is vital to seek professional help for filing your VAT returns. IMC Group is one of the leading VAT consultants in UAE. With our help, you can comply with the VAT laws as we keep you informed of all the latest updates and guidance issued by FTA from time to time.