The Federal Tax Authority (FTA) has urged businesses to file their first VAT returns by no later than the last day of this month to avoid penalties.

The first tax reporting period since the January 1 rollout of a 5 per cent VAT in the UAE ended on Wednesday. VAT returns must be filed monthly by companies with annual turnover above Dh150 million, while businesses with revenue below that level must file quarterly.

“Taxable persons must comply with tax laws, submit tax returns, pay their due taxes within the specified time frames and keep records as required in tax legislation in order to avoid penalties,” said the FTA’s director general Khalid Al Bustani.

For some companies, exceptions have been made, “following requests from a large number of businesses subject to VAT”, said Mr Al Bustani.

The first tax period has been extended to three months in some cases, he said. The filing period will return to a monthly basis afterwards for these firms.

Businesses whose initial tax period was for the three months ending in March, have not been given any leeway, said the director general.

The UAE began implementing VAT along with Saudi Arabia as part of a planned GCC-wide levy as member countries seek new revenue streams amid lower oil prices.

DOCUMENTS TO BE FILED FOR THE VAT RETURN :

• Records of all supplies and imports of goods and services
• All tax invoices and tax credit notes
• Alternative documents related to receiving goods or services
• All tax invoices and tax credit notes
• Alternative documents issued

Source: www.thenational.ae/business/economy/vat-in-the-uae-first-tax-returns-must-be-submitted-no-later-than-february-28-1.701366