Is it possible to change the VAT return filing period in UAE?

Filing VAT return is one of the key activities within the tax function of any organization. The return filing period as assigned to each taxable person has a significant impact on the processes involved in successful preparation and submission of the return on time.

What is the relevance of tax return filing period for VAT registered entities in UAE?

VAT return filing period can be different for each of the registered entities. For some, it may be quarterly and for others, it may be monthly or a different period as instructed by FTA to each of those who are VAT registered. This can be again confirmed in the FTA portal, in case clarity is required. Each of the registered users can log in to the FTA portal with their credentials and they can confirm their own VAT return filing period. Regardless of the frequency of the return period, the final date to file the return will be 28th day after the completion of each VAT return period. In case if this due date happens to be on a weekend or a national holiday, then the final date will get extended to the next working day. Also, it is to be noted that if there are no transactions for the VAT return filing period, then a ‘NIL’ return has to be submitted by the due date. Any failure in adhering to the rules of the VAT return submission may cause penalties, tax assessments/FTA audits or any such consequences as the case may be.

Procedures involved in changing the VAT return filing period in UAE

For changing the VAT return filing period, the VAT registered taxable person has to make a request application with FTA. The request shall accompany the details and reasons for such an application with supporting corroborative documents. On review of such application by FTA, the granting of approval for such a change in the return period purely depends on the discretion of the authority. 

Factors considered by FTA in determining the VAT return filing period

The major factor related to the VAT return filing period is the volume of business transactions. It can be seen that most of the registered entities enjoy the VAT return filing period on a quarterly basis. However, there are entities with higher value of supply of goods/services having a monthly VAT return filing period. 

Implications of changing the VAT return filing period from monthly to quarterly

The major consequence of a change in the VAT return filing period will be obviously the impact of time, costs and efforts involved in preparing and submitting a VAT return. By reducing the frequency of the returns, a reduction in time, costs and efforts spent for such a reporting activity can be achieved. However, as the frequency decreases, the volume of transactions to be summarized in a VAT return will be higher and the businesses who are intending for such a change shall ensure their capacity to handle that increased volume, the corresponding reviews and to facilitate the increased fund requirement for tax payments on time if applicable.

CDA’s Role in Changing VAT Return Filing Period in UAE

We at CDA are happy to help you in accomplishing your tax responsibilities and we can assist you in various areas such as obtaining tax certificates, tax registration, tax planning, preparation of tax flow forecasts, tax implementation including system setup, computation of input tax recoveries for general expenses, preparing VAT returns, reviewing VAT returns, submission of VAT returns, voluntary VAT disclosures, periodic tax reviews, VAT accounting, record maintenance, compliance check, internal process reviews, VAT training for employees, compilation of policies, correspondences with FTA, preparing for FTA audits and many other specific tax matters.

This brings us to the conclusion of discussion on the possibilities to change the VAT return filing period in UAE. Do you need support for the preparation and submission of your VAT returns? Contact CDA for tax assistance.