VAT Returns deadline is 28th of every month. Excise Tax Returns deadline is 15th of every month ESR Notification Submission deadline, 6 months from the end of the financial year ESR Report Submission deadline, 12 months from the end of the financial year Click here to know the Foreign Exchange (FX) rates applicable for VAT from the UAE Central Bank website
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Tax Audit (VAT & Excise)

In taxation, the process in which the tax collection agency reviews the reports of an individual or company to see if income, deductions, and/or credits reported accurately reflect reality. This is done to ensure that each company pays its full tax liability.

A) Excise Tax Audit:

Spectrum performs Excise Tax audits to verify and issue a compliance report with respect to tax laws and regulations issued by Federal Tax Authority (FTA) of United Arab Emirates.

Spectrum can review and issue excise tax audit report to comply with the requirements of FTA after performing the standard audit procedures to get reasonable assurance on the above-mentioned excise goods produced, imported or sold in a particular period.

B) VAT Audit:

Spectrum also performs Value Added Tax (VAT) Audit for the businesses in UAE.

A). Excise Tax Audit:

Federal Tax Authority also requires an audit report about:

  1. Goods produced, imported or sold for a particular period based on the following:
    • quantity and value of excise goods stored (by item) within the specified period.
    • average monthly sales for excise goods (by item) within the specified period.
    • average monthly inventory for excise goods (by item) within the specified period.
    • quantity of excise goods (by item) that was produced or imported.

  1. Excise goods that is produced, imported, released from designated zones, sold or exported for specified period:
    • list of companies and retail stores that have been supplied with excise goods.

B). VAT Audit:

As part of VAT Audit we perform review of the books of accounts and accounting software, review of output tax, input tax and VAT returns filed as explained below.

Books of accounts and Accounting software system review:

Proper accounting is mandatory in an organization to ensure that it complies the UAE VAT law which will result that there is no discrepancy during a tax audit by a tax auditor. If company using the accounting software that software used in the company should be capable of handling Proper tax invoice, Credit notes and recording reverse charge entries, calculating Output and input tax entries as per the FTA.

Review of calculation of Output Tax includes the following:

  1. Whether all taxable supplies at standard rated are charged at respective tax rate. (as of now 5%).
  2. To ensure that only eligible zero-rated supplies are charged as zero-rated and proper supporting documents are maintained.
  3. To ensure that out of scope supplies if any are accounted properly.
  4. To check whether the goods imported into the UAE through UAE customs are recorded under Reverse Charge Mechanism
  5. To reconcile the amount shown in FTA records as value of goods imported and the output liability on such imports with the records shown under the books of accounts.
  6. To check whether the services if any imported from outside the UAE are recorded under Reverse Charge Mechanism.
  7. To check whether only the eligible input credit are taken against such import of materials or goods under reverse charge mechanism.
  8. To check whether exempted supplies if any are recorded and reported properly.

Review of compliance of Input Tax includes following:  

  1. Input tax claimed by the taxable person has to be properly reviewed to ensure that no discrepancies are detected during the tax audit.
  2. We exercise verification such as: Whether only eligible input credits on purchases and expenses are claimed.
  3. In the case of mixed supplies (exempted and zero rated / standard rated) whether the input credit is calculated as per the formula provided under the law.
  4. Whether input credit on import of goods and services are calculated and claimed properly.

Review of the VAT returns filed

Our tax experts will review the Vat return files to be submitted to the authority and make sure that:

  1. The output tax payable to the authority are recorded properly.
  2. Check the eligibility amount is claimed as input credit.
  3. The reporting of output tax under reverse charge are recorded properly.
  4. Zero rated supplies and exempted supplies are recorded separately.
  5. Additional reporting such as profit margin scheme, etc., are reported properly.
  6. To check whether the due tax amount is paid to the tax authority before the due date periodically.

Spectrum Auditing and Accounting is an end-to-end accounting and audit services company and is a registered VAT Consulting firm based in Dubai. We offer VAT Agent & VAT Audit services in Dubai, Abu Dhabi, Sharjah, Ras Al Khaimah, Fujairah, Ajman, Umm Al Quwain covering the whole of UAE. We provide a comprehensive portfolio of VAT services ranging from Tax Advisory Services, VAT Implementation Services, VAT Return Filing, VAT Compliance Review, TAX Consultancy Services and Tax Agent Services apart from Tax Audit Service.

 Call us today for a consultation.

Tel: +971 4 269 9329 | E-Mail: [email protected]

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