VAT 2018

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We’re ready to welcome VAT which might be one of the biggest tax reforms to be introduced in a GCC country.

Noted that VAT tax will be imposed on most of the goods & services transacted in the UAE, we have considered it vital to adopt changes involved in the operations, maintenance, delivery and service related to all types of ERP software applications in UAE. By following this practice which might often require a review by top end VAT ERP UAE specialists, we shall gradually get familiar in selling VAT compliant ERP software’s in Dubai.

Before we begin to kick-start our preparations to accept vat.
Let’s outline some of the reasons why tax ministers, tax specialists and of course vat specialists is urging every business firm to initiate their preparations in receiving in VAT in the year 2018.

Firstly Experts hint VAT will present a number of challenges for most of the businesses in the region as the tax reform will have an adverse impact on all the major lifelines of a business.

Let’s now get into the key factors of why firms need to roll their sleeves in advance to accept VAT for any ERP prospective business service in the UAE.

  • Experience from the implementation efforts of administrations in the UAE indicate that businesses will certainly require time to prepare their business in terms of manpower, customers as well as vendors.
  • Dealing with such a vital business challenge would require the involvement of senior management personnel to ensure that the team treats this entirely as a different project and would be completely engaged in working on it.

Why would we treat VAT Implementation as separate project of its own?

  • Considering a project for VAT implementation may perhaps simultaneously overlap with other revamped projects of the business, we will allocate sufficient resources for the project.
  • There must be several internal resources allocated to the VAT project such as project managers, personnel to conduct periodical reviews of the project etc.
  • We need to analyse if external resources for the project would be available and if so what would be the requirements to keep them involved. Hence involving external resources such as VAT specialists, business analysts as well as project management consultants must be done with all the requirements intact.
  • Finally and the most important aspect what we need to consider for VAT implementation in the UAE is the adverse impact it would have on the cross border transactions and transactions within the GCC. Implications on pricing, customers, vendors, intermediaries supply chain etc. need to be considered.

Why we need to be extremely cautious while integrating VAT with our ERP in Dubai?

  • Ensuring the accuracy and efficiency of VAT compliant ERP service is completely dependent on the functionality of an ERP system.
  • Operational malfunctions in the system used to manage VAT compliance would bring in serious financial risks to the business.
  • There have been numerous examples in the past of various businesses mismatching VAT treatments in the sales & purchases of their operations, double payments of VAT, forgotten adjustments in VAT filing.
  • Flaws in the basic VAT configuration of a service/ software would also carry serious negative consequences for an organization.
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