6 steps the businessmen should take now for implementing UAE VAT
STEP 1: Check whether your company needs to be registered for VAT or not.
Whether your current year turnover is more than AED 375,000/?
Whether the activity of your company is coming under other than any of the exempted category such as healthcare, education, local transport, residential real estate or any of the selected 100 essential items?
If the annual turnover of the taxable items is more than AED 375,000/, you have to register for VAT.
STEP 2: Suitable Software: Check the following.
Do you have a proper accounting software in your company?
If yes, does it have VAT module?
If no, whether the software support team is ready to make necessary changes in the software as and when required?
If you do not have proper accounting software in place now, better to find the one suitable for your business from the market.
STEP 3: Right people on board:
Check whether you have skilled people to handle the challenges on VAT compliance in:
IT (Information System) Department
Documents Controlling Department
STEP 4: Study the operational activity of your company:
Engage a Tax Expert in analyzing the operational activity of your company for Tax Planning.
The Tax Expert will advise all areas which are to be considered for best tax planning including the best possible supply chain of your company, intercompany transactions, reviewing the existing long-term contracts, options to take maximum input tax credit of the purchases, services, and expenses. They will suggest the necessary changes the companies need to make to face the new challenge under VAT.
STEP 5: Register for VAT:
As and when the online portal is ready for registering for VAT, get registered (probably in the third quarter of the year 2017).
STEP 6: Maintain Proper Records:
The management has to ensure that the proper records are maintained in the company and VAT returns are filled (quarterly) within the due dates as per the Law.