VAT is a type of indirect tax that is applied on consumption of goods or services at the point of sale. The periodic summery of total value of supplies/services and purchases, a taxable person has made during the tax period is called VAT return and it shows the taxable person’s VAT liability.
The difference between the output tax payable (VAT charged on supplies of goods and services) for a given tax period and the input tax (VAT incurred on purchases) is the VAT liability of such tax period. When a VAT liability arises i.e., the output tax exceeds the input tax amount, the difference must be paid to Federal Tax Authority (FTA). While in case the input tax exceeds the output tax, a taxable person will have the excess input tax recovered; he will be entitled to set this off against subsequent payment due to FTA.
It is mandatory for taxable persons and/or businesses registered under VAT to submit VAT return to Federal Tax Authority (FTA) regularly at the end of each tax period. Usually, it is required from taxable persons to submit the VAT return electronically through the FTA portal (eservices.tax.gov.ae) within 28 days of the end of the tax period. The tax period for different businesses is different but the standard tax period is: quarterly for businesses whose annual turnover is below AED150 million and. monthly for businesses whose annual turnover is AED150 million or above.
If a taxable person and/or businesses registered under VAT Fails to file a tax return within the stipulated time frame, such violator shall be liable for fines as per the provisions of Cabinet Resolution No. 40 of 2017 on Administrative Penalties for Violations of Tax Laws in the UAE.
We at “Virtual Accountants (VA)” are providing VAT return filing services in UAE on quarterly and monthly basis, according to Company’s tax period. Our exclusive VAT services cover all aspects of VAT in UAE. Virtual Accountants is equipped with a team of enthusiastic VAT experts who will not let your business lack behind due to your lack of familiarity with VAT rules and regulations, structure and compliance issues and lack of an efficient accounting system. We will make sure that your accurate and timely VAT return filing keeps you safe from potential FTA fines and penalties.