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Tax Consultants & Bookkeepers in the UAE

        

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Federal Tax Authority: Any person or group has the right to apply for a reduction or exemption for Tax Law violation penalties

The Federal Tax Authority (“FTA”) has announced that any person or group has the right to apply to the FTA to reduce or exempt them from the penalty imposed for the violation of the provisions of tax legislation, provided that there is an excuse acceptable to the FTA, which is supported by evidence that justifies the existence of the excuse and the violation that led to the imposition of administrative penalties.

The FTA clarified that according to Cabinet Decision No. 51 of 2021 on amending the Executive Regulation of Federal Law on Tax Procedures, any person or group who is found to have violated the provisions of the law or the tax law may submit such a request to the FTA to reduce or exempt from the penalties imposed by the FTA in accordance with a set of conditions. Read more..

Expert VAT Opinions

A47) Can a company de-register from VAT without paying existing fines?

You cannot de-register from VAT without paying the fines first.

To solve this, you must submit the missed returns on the Federal Tax Authority portal immediately. Even if they are zero returns, this needs to be done to avoid further charges. I advise paying the existing fines, then completing a reconsideration form asking the FTA to waive the fines imposed.

The form can be found on the FTA website, but the form and all supporting documentation must be submitted in Arabic. To apply for reconsideration and de-registration, the FTA says you must have paid any outstanding tax and penalties first. Read more...

FTA Press Releases

Federal Tax Authority holds 3 interactive sessions in Q1-21 as part of “Tax Clinic” initiative for SMEs

The Federal Tax Authority, FTA, has held three new interactive sessions via video conference, as part of the “Tax Clinic” initiative, a policy of direct and constant communication with business sectors which aims to promote tax awareness and avoid the most common errors that might occur while implementing tax procedures.

The FTA confirmed that the three awareness sessions held in the first quarter of 2021, Q1-21 focused on the small and medium enterprise, SME, sector. Teams of tax analysts and experts from the FTA’s Registration and Taxpayer Services Departments answered, via video conference, the inquiries of business representatives from across the emirates about registration and other tax obligations and raised awareness of how to submit returns and pay tax dues without errors. Read more..

Federal Tax Authority showcases 3 key initiatives during UAE Innovation Week

The Federal Tax Authority, FTA, is taking part in the UAE’s Innovation Week, which was launched last week, under the slogan ‘UAE Innovates 2021’, with the aim of enhancing and promoting an innovation culture and encouraging community participation in designing and developing future experiences and initiatives.

 His Excellency Khalid Al Bustani, Director-General of the FTA, said that the Authority’s participation in UAE Innovation Week is in line with its strategy to encourage innovation, development, and to contribute to the UAE’s efforts to strengthen the national strategy for innovation and digital transformation, in order to continuously develop and improve government services. His Excellency stressed that this contribution reflects the FTA’s understanding of customer needs and its efforts to meet their expectations and keep them happy. Read more..

FTA continues Inspection Campaigns in Local Markets to Ensure Compliance

The number of inspection campaigns organized by the Federal Tax Authority (FTA) witnessed notable growth during 2020 across UAE markets, some were conducted in collaboration with Departments of Economic Development and other relevant entities throughout the Emirates, to protect consumer rights and increase the level of tax compliance.

 In a press statement issued today, the Authority emphasized that these campaigns were carried out within the framework of the Authority's extensive efforts to contribute towards strengthening market performance and ensuring compliance with all tax legislation and procedures to protect legitimate trade and prevent the sale of contraband within the UAE and tax evasion. Read more..

Maintenance of Financial records under VAT

As per Decree-Law, all businesses in the UAE need to record their financial transactions and ensure that their financial records are accurate and up to date. The final responsibility and accountability to comply with VAT is on the business.

Accounting Records and Commercial Books

As per Executive Regulations of Federal Law No. (7) on Tax procedures, Accounting Records and Commercial Books shall include the following:

  • Accounting books in relation to that Business, which include records of payments and receipts, purchases and sales, revenues and expenditures, as required under any Tax Law or any other applicable law, including:
    • Balance sheet and profit and loss accounts.
    • Records of wages and salaries.
    • Records of fixed assets.
    • Inventory records and statements (including quantities and values) at the end of any relevant Tax Period and all records of stock-counts related to Inventory statements.

Businesses that do not think that they should be VAT registered should maintain their financial records in any event, in case the authorities need to establish whether they should be registered.

Contact Finance Works to maintain your books and records and implement financial systems that are VAT ready and compliant.

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