VALUE ADDED TAX (VAT)
GCC VAT Implementation Support
As they say, any strategy, even a great one, doesn’t implement itself. Implementation is a challenging and onerous activity. We believe that implementation should be impeccable and flawless so that business can continue to function smoothly during and post implementation.
What we do?
- Impact Assessment : Mapping VAT impact for the transactions undertaken by the businesses including impact on various business functions
- Registrations : Assistance in applying for VAT registration
- IT System review : IT system reflects the output of the VAT implementation project. We undertake gap analysis to identify changes required at Master and transactional level as well as conducting User Acceptance Test (UAT) to ensure system readiness
- Transition management : Handholding to ensure successful transition to VAT regime
- Hypercare support : The intent and conception behind Hypercare support is to enable businesses to focus on their core operations while leaving the functional aspects of VAT with the VAT expert to ensure compliance and smooth transition to the tax regime
- Project Manager : Dedicated Project manager to spearhead the implementation project and constantly liaise with the client
- Representation : Identifying areas which require Representation to the Tax Authorities and providing assistance in filing the same.
Technical and functional Trainings
Dissemination of salient aspects of VAT among all stakeholders is a crucial part as it has to be followed and implemented correctly by all the stakeholders. Training sessions are intended to provide information and training on VAT aspects in relation to all key constituents of a business. Topics are covered in comprehensive, yet compact modules that are bifurcated into the following four parts:
- Beginner VAT awareness sessions on the generic aspects of VAT
- Functional awareness sessions for understanding impact on key business functions;
- Training for understanding compliances and reporting requirements
- Awareness session for entity’s vendors and customers to bring them onboard VAT for tax compliant transactions.
Developing Standard Operating Procedures (SOPs)
Processes enables an employee to execute a task in defined and structured manner. Most of the day-to-day activities managed by the employee are process driven. Since, VAT is a transaction-based tax it is imperative to analyse and align each step of the process with the provisions of VAT Law so as to ensure there are no gaps in compliance. We undertake following key steps to identify potential areas of VAT impact:
- Discussing with Head of Departments (HODs) to understand end-to-end process
- Review of documentation trail for the entire process
- Suggesting areas of VAT impact in terms of changes in roles and responsibilities as well as documentation changes.
GCC VAT compliance support
We assist companies in preparation, review and filing of VAT return across the GCC countries which involves the following key steps:
- Review of sales and purchase registers along with sales and purchase invoices
- Review of financial information
- Review of documents, invoices, agreements, etc.
- Review of VAT return workings prepared by the Company
- Providing assistance in finalizing VAT return workings
- Assistance in filing VAT return.
We assist companies by managing the queries raised during and post VAT implementation and would undertake the following:
- Providing advice on ongoing matters with respect to the Company’s VAT obligations, including tax position to be adopted, tax risks, documentation, records to be maintained, etc.
- Ascertaining the impact on the tax updates / developments, on the tax position taken by the Companies
- Assisting Companies in filing Reconsideration to challenge to decision issued by the Authorities
- Assistance in representing Companies before Resolution Committee, Courts, etc.
Filing Clarification / Ruling applications
- Advising Companies on matters which are complex / unclear on which position has not evolved
- Undertaking technical research including research in other tax jurisdictions
- Providing assistance in drafting and submitting Clarifications / Ruling request with the Authorities.
VAT Audit support
- Providing pre-audit, during audit and post audit support to Companies in form transaction advisory, documentation support, etc.
- Highlighting risks, areas of exposure / non-compliance during pre-audit and audit phase
- Advising on way-forward post completion of Audit by the authorities.
Refund of VAT is a scenario where input tax amount is higher than output tax amount as per the tax return filed with the tax authority. Typically refund claim is scrutinised by the tax authority before sanctioning the refund claim. We assist in undertaking the following:
- Advising whether refund application should be filed or excess input tax should be carried forward to subsequent tax return
- Preparation of refund application and assistance in submission (including review of refund related documents)
- Assisting in replying to queries raised by the Authorities prior to sanctioning the claim.
It is obligation of every person to abide with the Law of the Land. Typically, it can be observed that any new implementation requires retesting on timely basis to monitor its functionality. Similarly, it is very crucial for all organisations to ensure whether it has been correctly following with the provisions of the VAT, Excise regulations (if applicable) governing the organisation. Accordingly, a thorough examination is required to identify gaps, reason of occurrence, its ramification and corrective measures to be undertaken to avoid its reoccurrence. We undertake the following key steps:
- Review of all business transactions and corresponding tax policy;
- Review of all processes (for e.g. AR/ AP) and recommending changes thereof;
- Review of reports configured and identification of any additional requirement;
- Documentation review for e.g. contract review, invoices review, etc.
Deputation/ VAT Function Outsourcing
Taxation is a branch of knowledge which requires specific educational background along with domain specific experience. Accordingly, basis the scale of operations a tax team or tax expert is required to manage governance and compliance. We can assist companies by providing tax specialists (i.e. outsourcing, co-sourcing, deputation, etc.) so that the company has to only focus on business while tax compliances are handled by experts.