Let's learn all about VAT return filing in the United Arab Emirates (UAE).
A tax return consists of a summary of all the purchases and sales made by a business during a tax period. Taxpayers must report exempted supplies, exports and imports, and the VAT collected or paid on every transaction in return. Further, VAT-registered businesses must file returns based on the invoices issued during the tax period.
The VAT return form in UAE is named VAT 201. The taxpayer needs to fill and submit it to complete the VAT return filing.
Every VAT-registered taxpayer is required to file a VAT return once every tax period. The tax period can be a month or a quarter, depending on the prescriptions given by the FTA on the VAT certificate.
The last day to file the VAT return, whether monthly or quarterly, is the 28th day of the month following the end of the VAT return period.
Further, if your last date falls under a public holiday or weekend, your last date will be the next business day.
Also, there might be cases where the first tax period can exceed three months. Suppose your first tax period is between 1st January and 30th April, then your last date to file a VAT return would be on or before 28th May 28.
The FTA portal is designed to accept returns only online. Hence, taxpayers must manually fill in the purchases, sales, input and output VAT etc.
The form VAT 201 is broadly categorised into seven sections as follows:
Here’s the step-by-step process to file a VAT return in UAE:
Step 1: Log in to the EMARATAX portal using the registered username and password.
Step 2: Click on the navigation menu and follow the below path:
VAT → ‘View All’ under ‘My Filings’ → Click on ‘File’ for the return period
Step 3: Select the check box confirming the instructions and guidelines and click the ‘Start’ button to proceed with the filing.
Step 4: The window displays all the filing period details based on the selected VAT return.
Step 5: You can use the offline template to fill in the data offline. Click on the download, fill in the data and upload the Excel file. Further, you can download the uploaded Excel to review the errors (if any) or clear the data if you want to upload a new Excel.
Step 6: You must enter the amount, VAT amount and adjustment in the respective boxes.
Step 7: Now, fill Box 1 with details of standard rate sales made to the corresponding emirate.
Step 8: The tax refunds given to tourists under the ‘Tourist Refund Scheme’ will be auto-populated to Box 2 from the ‘Planet Tax Free system’. Also, you can click on ‘View Details’ to check the auto-populated data.
Step 9: Fill in Box 3 with sales made under reverse charge provisions.
Step 10: In Boxes 4 & 5, provide the zero-rated and exempt sales.
Step 11: Box 6 will be auto-filled with data received from Customs. You can click on ‘View Details’ to check the data. Further, if the import data is incomplete or incorrect, you can make adjustments using Box 7.
Step 12: Box 8 represents the total of Box 1 to Box 7, i.e., total sales and tax liability for the return period.
Step 13: In Box 9, enter the amount, VAT amount and adjustment for the standard rated expenses.
Step 14: Fill in the reverse charge purchases in Box 10.
Step 15: Box 11 represents the total of Box 9 & 10, i.e., total inputs for the return period.
Step 16: Box 12 & 13 represents the total output and input taxes for the return period. Further, Box 14 displays the tax payable or refundable for the return period.
Step 17: Select ‘Yes’ under ‘Profit Margin Scheme’ if you’ve reported using the same; if not, select ‘No’. After that, click on ‘Save as Draft’ to save the submitted details and then click ‘Next Step’ to proceed.
Step 18: This window displays the data submitted, and you can do a final review before submitting the return. Also, you can click on ‘Expand All/ Collapse All’ to do a section-wise review.
Step 19: When you scroll down, the window shows the declaration details pre-populated from the VAT registration. Finally, click the checkbox and then the ‘Submit’ button to submit the VAT return.
Step 20: The screen will display submission details once the return is successfully submitted. You can take a note of the reference number for future reference.
Step 21: After submission of the return, you must make the tax payment within the due date. Also, you can edit the submitted data till the due date. Further, you can download the VAT acknowledgement return copy by clicking the ‘Download’ button.
Please note that you need summary-level details of sales, purchases, expenses, input VAT and output VAT as per the VAT return format notified by the Federal Tax Authority (FTA).
Further, in a few boxes, you must report the sub-level details or declarations based on eligibility. For example, you should report
Non-filing or incorrect filing of VAT returns in the UAE results in huge penalties ranging from AED 1,000 to AED 3,000. Hence, you should be very careful while filing the VAT returns and comply with the VAT law.