What is a VAT Return in UAE?

A VAT return is an official document to be completed by the Taxable Person and submitted to the Federal Tax Authority (“FTA”) at regular intervals detailing any output tax due and input tax recoverable and including any other information that is required to be provided.

All VAT Returns should be submitted online using the FTA portal. The return can be submitted by the Taxable Person, or another person who has the right to do so on the Taxable Person’s behalf (for example, a Tax Agent or a Legal Representative).

The VAT Return must be received by the FTA no later than the 28th day following the end of the Tax Period concerned or by such other date as directed by the FTA. Where a payment is due to the FTA, it must be received by the FTA by the same deadline.

If there is no business transaction for the Tax Period, you are required to submit a “nil” VAT Return by the respective due date.

What is the benefit of conducting a review of Historical (Past) Returns?

Tax returns filed by the registrant is the basis of any scrutiny or evaluation for FTA. Review of returns already filed (historical returns) will identify any anomalies and subsequent corrective actions required to rectify the errors or omissions. Anomalies can include reporting of standard-rated sales as zero-rated sales, Service RCM not recorded accurately, Adjustments to RCM goods and services not made properly, the Wrong claim of input tax, RCM reversals not taken accurately.

Corrective actions can include a voluntary disclosure submission or correction in the subsequent return. Review of past returns will ensure that all returns filed are as per UAE VAT rules and chances of any penalty are nil.

What is a VAT Refund Application?

Every Taxable Person is required to file a VAT return summarizing the VAT due to the FTA for the tax period. When the input tax is greater than output tax on a VAT return, the Taxable Person is able to request a VAT refund in UAE after submission of the VAT return or at any later time when there is a credit owed to them.

Where the Taxable Person makes a claim for a refund of excess refundable tax, the FTA will within 20 business days of an application being submitted, review the application and notify the Taxable Person of its decision to accept or reject the refund claim. The FTA may notify the applicant that it requires a longer period than (20) business days to consider the application where appropriate.

Tax authorities scrutinize the refund application with strict criteria. The refund application has to be submitted in correct format as prescribed by FTA.

The tax professionals at Precision AI Solutions shall assist you to file VAT refund applications on a timely basis in correct format, suggest corrective action to rectify any discrepancy which can expedite the refund process and respond to FTA queries related to the refund application. Timely and accurate refund application with sufficient document submission will result in timely refund process thereby causing positive cash flow and smooth business operations.