There is no delay VAT starts 1 January 2018
Entrepreneurs’ Organization (EO) UAE, the local chapter of the global network of entrepreneurs, held a VAT Workshop with business adviser Grant Thornton UAE.
In 2016 the GCC countries signed a VAT framework agreement. Under the terms set out, two countries have to implement VAT on 1 January 2018. As of now, those two countries are the UAE and Saudi Arabia. Bahrain, Oman and Kuwait are set to follow suit a year later, implementing VAT on 1 January 2019.
“What I have found shocking over the last six months is the nonsense making the rounds by businesses. The latest rumour I heard two days ago was that VAT registration was determined by the number of staff in the company. Another rumour is that the FTA will charge EUR 50,000 for each company to register for VAT. One CFO said they knew the tax office has been told to delay the implantation date by six months ‘because nobody is ready’. None of this is true. Make no mistake; there is no delay. VAT is going to be collected from 1 January,” said Gurdeep Randhay, Director and Head of Tax, Grant Thornton.
Randhay touched on a number of important issues, such as what registering for VAT means for businesses, the important difference between exempt and zero-rated supplies, important considerations regarding residential real estate, as well as breaking down the difference between input and output tax.
The event took place on 13 September at the Ritz Carlton, DIFC and kicked off with a general workshop, led by Randhay, before attendees split into smaller groups by sector. The interactive session was attended by around 50 entrepreneurs who participated by raising a number of questions that sparked a number of discussions.