Governments impose certain taxes on their residents and citizens to generate revenue. The collection of taxes helps boost a country's economy as this money is used to build better infrastructure and provide timely public services. UAE, which was once considered to be a tax-free zone, changed that status in January 2018, when they introduced the Value Added Tax. All businesses that carry out the purchase and sale of goods and services should register for VAT. The rate for the VAT is kept at 5%, which is considered rather low.
With the implementation of this new tax came a lot of bookkeeping and auditing on the part of companies. To carry out the correct calculations, registration, and filing of the taxation is not an easy job. Business owners find it rather troublesome and often make mistakes that may result in penalties. VAT consultation companies exist in UAE to solve this very problem for the companies. They can hire the services of VAT consultants who are well-trained professionals and keep themselves abreast of the recent policy changes and new laws. The tax return and filing process are made much easier by acquiring professional VAT services. The significance and advantages of hiring VAT consultancy services in UAE are discussed below.
Expertise and Experience
Your company can avail of VAT consultancy services for their expertise, knowledge, and skills. Vat consultants keep their knowledge related to UAE laws regarding VAT registration and rate up to date. Providing efficient financial services is a part of their job, and they can do it more efficiently than anyone else. Vat consultancy providers are well aware of the procedures, documentation required, and online registration process and have a set system to carry out all these activities. They also have years of experience in taxation services, so they are well equipped to carry out the necessary planning execution to file your company's Value Added Tax.
Cost-Effective and Time Saving
Bookkeeping, account management, and record maintenance are lengthy and complicated processes. IF you plan to do it in-house, it will take a lot of time and effort from you. Professional VAT consultants can take this job off of your hand, and you can focus more on ways to grow and expand your business.
Similarly, suppose you hire an accountant at your company for this job where they are responsible for the financial management and VAT registration. In that case, you will be paying them a monthly salary. Not just that, you will have to supervise and monitor their performance. VAT services providers will ease the tax filing process and substantially reduce your cost.
Maintenance of Financial Records
Recordkeeping is an essential part of the VAT consultant's job. Regular maintenance of financial records allows the professionals to be ready to conduct audits for taxation purposes at any time. They are prepared to carry out internal and external audits much quicker and more efficiently.
Competent Vat services providers can foresee how the VAT will affect the business, and they keep the owners updated about that. They can help managers make better financial decisions and come up with better VAT strategies.
VAT consultancy companies have systems in place to carry out the VAT calculations. These systems are efficient and tried and tested over time. The risk of wrong calculations is reduced when you hire VAT consultants. However, if you do the VAT estimation yourself when you are properly trained to do it, you may make a lot of errors. FTA can impose penalties and fines if the tax is not filed correctly and on time. Avoid these fines by hiring professionals for VAT returns.
Filing VAT returns is a job for the professionals who have expert knowledge of all the tax regulations in the UAE. It is advisable to hire the services of professional VAT consultancy firms that will handle all our company taxation needs. At Freezoner, you will not only get the best VAT consultancy services, but we also offer Company formation and Visa services.