Press Releases For Businesses


Commentary by Vikas Panchal, Business Head at Tally Solutions in the Middle East, a leading international accounting and compliance software provider.

The Federal Tax Authority (FTA) in the UAE has been helping businesses in the UAE comply with VAT registrations since its introduction. FTA’s initiative in classifying the tax payers into different return cycles and the extension of tax period for first return has provided the much needed time to equip, prepare and file VAT returns.

This has met with a positive response with a steady increase in the tax compliance ratios and also the tax return filing, confirming the success of the model adopted by the FTA. The additional time not only allowed companies more opportunity to get things right, but also gave businesses an opportunity to connect with VAT experts to seek guidance and interpret the rules well. It also enabled several businesses to streamline all business functions as per the provisions of VAT to ensure business runs in line with policies.

Additionally, FTA also ensured that the VAT Decree Law as well as Executive Regulations were available in both, Arabic and English language, which helped the multi-national companies in appropriately decoding the VAT provisions and implementing VAT appropriately. In addition, the FTA introduced VAT with single rate of 5 per cent (as per Gulf Cooperation Council (GCC) VAT Agreement which has ensured remarkably higher compliances.

In summary, the UAE government has been strategic with the introduction of VAT, allowing and encouraging businesses to have time to comply with the new legislation.

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