The UAE Federal Tax Authority (FTA) recently published an updated VAT Guide on Input Tax Apportionment, offering crucial insights for businesses operating in the region. With new amendments and an extended scope, it's essential for taxable entities to familiarize themselves with these changes. In this blog post, we will provide a summary of the key updates and explain how KRV Auditing's free consultation for TAX and VAT in the UAE can assist you in navigating these changes.
Key Updates to the Input Tax Apportionment Guide:
Extended Scope – Outputs Based Special Apportionment Method:
Previously available to insurance companies, financial institutions, and local passenger transportation service providers, the outputs-based method now includes educational institutions and establishments like art galleries, cultural entities, and similar non-business establishments. If you're unsure about whether your business falls under this category, our tax agents in Dubai can help clarify.
Extended Scope - Sectoral Special Apportionment Method:
The sectoral method, previously used only by large complex businesses, has now been extended to real estate companies with separate divisions for commercial and residential properties. This change allows for more accurate input tax apportionment in diverse businesses.
FTA Review Timelines:
The FTA now takes up to 40 business days to respond to non-sectoral input tax apportionment requests and up to 60 days for sectoral method requests. Additional information may be requested if deemed necessary.
The Effective Date of Application of the Approved Special Method:
Once the FTA approves a special input tax apportionment method, businesses can use that method from the first tax period following the approval date.
Requirements for the Re-Application for a Special Apportionment Method:
Registrants must submit a new application to the FTA at least 40 business days before the expiry of the most recently approved special method. Major changes in the business must be highlighted, and the new application should include the same type of information and calculations as the original application.
How KRV Auditing Can Help:
Navigating the complexities of VAT and tax regulations in the UAE can be challenging. That's where KRV Auditing comes in. With over 20 years of industry experience, our FTA-approved tax agents are well-equipped to help you stay compliant with VAT requirements, such as registration, return filing, record keeping, financial reporting, VAT refunds, and health check services.
As the best VAT consultants in Dubai, we're here to guide you through the process of selecting a special method for input tax apportionment, based on the new FTA Guide. Our team of experts will ensure your business remains compliant and avoids penalties.
Free Consultation Offer:
At KRV Auditing, we understand the importance of getting expert advice when it comes to tax and VAT in the UAE. That's why we're offering a free consultation to help you navigate the updated VAT Guide on Input Tax Apportionment. Get in touch with us today to schedule your free consultation and let us help your business stay on the right side of the law.