VAT Audit involves the complete scrutiny of VAT records prepare by an entity to determine the accuracy of records and resultant tax liability or refundability of tax from the Federal Tax Authority (FTA) and to ensure compliance with VAT Decree Law and Regulations in terms of tax settlement within the due date.

In recent times, VAT Audits by management of entities has gained a momentum due to imposed fines by FTA to number of companies who are non-compliant with regulations, thus arising the need for VAT Audit that emerges to fall under below two categories of VAT audit nature:

Preventive in nature

To prevent the imposition of FTA fines, it is essential to regularly engage an independent assurance provider to conduct an internal VAT Audit of relevant records and compliances with regulations. Independent VAT auditor identifies issues and makes recommendations to resolve noted observations in advance of identification of issues by FTA.

Detective in nature

This VAT Audit is conducted after the issuance of notice or imposition of fine by FTA. In such case, independent VAT auditor conducts thorough analysis of given situation in light of VAT law or regulations to identify reason of FTA notice or fine and makes necessary recommendations to reduce or prevent harm and damages for an entity.

How we stand out as an Expert VAT Auditor

We are Chartered Accountants with background experience in a wide range of tax and audit engagements of our clients belongs to different industry segments. We possess strong analytical skills to conduct Audits and well-rooted knowledge of VAT Decree Law and Regulations. Our skill and knowledge, when combined with background experience becomes an ideal blend for our clients to attain value additions from our professional services.

Generally, our VAT Audit revolves around below matters:

  • Classification in VAT Returns and calculation of Input and Output Tax on supplies and expenditures including:
    1. Exempt, zero-rated and out of scope supplies.
    2. Single composite supply and multiple supplies in single transaction.
    3. Capital and operational expenditures.
    4. Supplies to, by and within free-zone and designated free-zone entities.
    5. Time and place of supply.
    6. Imports that are subject to Reverse Charge Mechanism.
    7. Inter-group transaction adjustments in-case of Group Return filing.
    8. Supplies and imports within GCC region.
  • Accounting and operational software relevant for an entity to generate VAT compliant documentations and reports.

Our recommendations are based on ground realities of given situation of our clients under an umbrella of VAT Law and Regulations, that enable our clients to meet FTA requirements.