Excise & VAT Accounting Services In Dubai, UAE

FTA is the official UAE regulatory authority for collecting taxes and conducting tax audits in all the Emirates. The Federal Tax Authority has stated proper executive regulations on the Tax Procedure Law for all UAE taxable entities. It includes that registered businesses must maintain a number of records and information in order to comply with the tax laws. There are two major taxes in UAE, one is VAT and the other is an excise tax and both of them require expert compliance. Tax compliance requires expert insights that’s why our team provides quality excise & VAT accounting services in Dubai, Sharjah, Abu Dhabi, Ajman, Fujairah, and other Emirates. Let’s first understand the regulatory requirements in detail:

UAE Regulations On Tax Accounting Records

In accordance with the UAE tax laws, each taxable entity is mandated to maintain its books of account for excise tax as well as VAT.  The FTA defines that records must be maintained for at least 5 years. The regulatory authorities can audit your tax records compliance as per the tax procedure law at any time. If the tax authorities find any error in the information or delay in filing, they will impose administrative tax penalties on the registrant. The non-compliance penalty for not keeping records or books of account as per UAE tax laws is AED 10,000 for the first time and AED 50,000 for repeated offenses. To keep records and prevent excise & VAT fines and penalties, you are advised to take professional tax consultancy in UAE.

What Is VAT In Accounting?

VAT accounting is related to the value-added tax records of a business account. The accounting treatment of VAT is simply done to evaluate VAT compliance as per FTA guidelines. This includes concerning documents, VAT calculations, return filing history in specific tax periods, and other information recorded in VAT accounting software. The accuracy and compliance of VAT data are reviewed under the UAE Tax Law. As it is compulsory, the taxable person is advised to avail of the advisory for any VAT services in Dubai, UAE, and be compliant with the state tax provisions.

VAT Rates In UAE 

Under the UAE tax procedure law, the value-added tax is calculated based on a different rate for each of the following categories:

1. The standard rate (5%) is charged on foods, automobiles, cosmetics, apparel, etc.
2. Zero Rate (0%) is implied on certain exported products, imported precious metals, residential buildings, and many other public services.
3. Exempted Rate is levied on some financial services, transportation, vacant land, and other goods and services defined in VAT laws.

Documents Required for VAT Accounting

For VAT-compliant accounting, the registrant entity must prepare some verified documents as per regulatory requirements. There is a list of documents that must be ready, such as:

• Annual books of account & VAT Ledgers.
• Credit and Debit Notes.
• Total no of tax invoices issued & received.
• Report of all outward supplies & imports.
• Record of goods and services exported along with invoices.
• Records of account adjustments or corrections.
• Detail of input & output tax on imported & supplied goods.

What Is Excise Tax Accounting?

The excise tax accounting procedure and requirements are different from VAT but it has a common purpose to be compliant with government regulations. The accounting for excise tax includes eligibility of excisable goods as per rates, registration, and return filing for excise tax along with detailed documents. The proper maintenance of excise records will reduce the tax burden on the FTA registrant. So that the authorities will verify the compliance with UAE tax laws and regulations. You may take suggestions for excise tax services in UAE and get ready for an authority’s inspection in the near future.

Documents Required For Excise Accounting

The excise tax accounting requires meticulous documentation in order to comply with UAE tax laws. Here we mention some of those:

• Excise tax reports as per FTA standards.
• Details of charged tax on excisable goods.
• Report of the excisable item produced, imported and stockpiled.
• Detail of the excise return filing for each tax period.
• A record of all excise goods that have been damaged or lost.

Why Do You Need To Outsource Tax Accounting Services?

Accounting & Bookkeeping is a substantial part of each small and medium-size firm. Tax accounting is one of the most prominent types of accounting, which must be accurate and compliant with the state tax laws. It is the Federal Tax Authority’s (FTA’s) responsibility to oversee all tax matters in all areas of the emirate. Organizations need to handle the complex tax regime of VAT and excise tax efficiently, otherwise, a little mistake could lead to heavy penalties. Accounting departments must put in place regulatory guidelines to ensure tax compliance.

This is sometimes a challenging and complex task for ordinary tax agents and accountants. It is advisable to outsource experts for excise and VAT accounting services in Dubai, Abu Dhabi, Sharjah, and UAE.  The tax consultants will fulfill all accounting and financial reporting requirements as per UAE tax laws.

Advantages Of Doing Excise & VAT Accounting 

Systematic and well-organized tax records are essential to fulfill regulatory obligations. Excise and VAT compliant accounting services provide a number of benefits to the taxable businesses in UAE, such as:

1. Ensure Tax Compliance

The updated and error-free excise and VAT accounting records are compulsory to assure the FTA provisions. It serves as a checklist that all tax-related documents are filed in a timely manner and compliant with UAE tax laws. Moreover, tax advisors review VAT accounting software and make recommendations if needed.

2. Minimize Administrative Penalties

As FTA registered businesses are mandated to maintain proper accounting records. This fulfillment of statutory provisions will minimize the risk of administrative penalties by the government.

3. Assure Timely Return Filing

The tax return filing is a complex procedure due to the limited tax durations. However, the tax consultants in UAE will assist individuals and businesses in filing their excise and VAT as per FTA guidelines. The team notifies you about mistakes in previous documents and submits them under the specified tax period.

4. Reduce the Burden of FTA Audits

The accounting statements that are compliant with UAE tax laws would eliminate many uncertainties. This proactive approach reduces the burden of taxable persons from FTA unexpected investigations.

5. Helps in Risk Assessment 

Excise & VAT accounting services provide a statistical overview of the organization’s financial position. As a result, management will be able to identify risks earlier and prepare better tax policies and strategies in the future.

Feel free to contact the leading accounting and tax consultancy firm in Dubai to compile your accounting records as per UAE tax laws.