SMEs in Northern Emirates in frantic rush to register with FTA
Companies in the Northern Emirates which failed to register for the value-added tax (VAT) by December 31, 2017, are now rushing to get their tax registration number (TRN) as the new tax regime has become a reality, tax experts said.
They revealed that companies which were initially hesitant and assumed that VAT would be delayed are now rushing to get registered with the Federal Tax Authority (FTA) in order to comply with the laws and perform their day-today transactions.
“Now, VAT is a reality. Ideally, companies should have prepared in advance; but that was not the case with many of them. They are in a hurry to get the TRN in order to avoid huge penalties. The government is lenient; we have seen notifications from the FTA that if you haven’t registered, please register now. It’s better if companies in the Northern Emirates start preparing quickly and implement VAT now,” said Jai Prakash Agarwal, manager — Oracle implementation at Aster DM Healthcare.
Agarwal was speaking at the ‘VAT Clinic’ seminar organised by
Khaleej Times and the Institute of Chartered Accountants of India (Dubai chapter) with the support of Qadi Accountants, a boutique advisory firm that provides services ranging from audit, accounting, advisory and taxation.
Agarwal, who is also a member of the ICAI Dubai chapter, said since VAT has come into effect, the pattern of questions being raised by participants at ‘VAT Clinics’ has shifted from being theoretical in nature to practical.
Vishant Mehta, manager, VAT, Al Shirawi Group, said small and medium enterprises are rushing for registration in order to bring their transactions in compliance
Companies should have prepared in advance; but that was not the case with many Jai Prakash Agarwal, manager — Oracle implementation, Aster DM Healthcare with the law. “Fearing high penalty, they are now rushing and asking tax consultancies to solve their queries. These queries are coming mainly from the SME sector,” said Mehta, also a member of the ICAI Dubai chapter.
However, the FTA has yet not released figures about how many companies have registered so far.
The UAE implemented VAT at five per cent — one of the lowest rates in the world — from January 1, 2018, as part of a GCC agreement.
S. Venkatesh, managing partner, MCA Management Consultants, Fearing high penalty, they are now rushing and asking tax consultancies to solve their queries Vishant Mehta, Manager, VAT, Al Shirawi Group told Khaleej Times that companies in the Northern Emirates had not prepared early.
“We had queries until the end of 2017 whether VAT would be implemented or delayed. Those who missed the bus are struggling. It is good to be ready even if it is delayed than struggle after it is levied,” Venkatesh advised.
“Even now people are asking for advisory and help in filing returns. A large chunk of companies started registration in the last weeks of December. The FTA was quick and allotted provisional TRN before December 31,” he noted.
— waheedabbas@khaleejtimes.com