Completing this checklist will help identify and correct errors before they are discovered by the FTA. Below is a practical checklist adapted to the requirements of UAE legislation.

Important: regular internal audits and error prevention are the most reliable ways to protect your business from fines, penalties, and undue attention from tax authorities.

How to Use the Checklist

• Conduct audits at least once a quarter.

• Record all identified non-compliances and assign responsible parties for their rectification.

• In case of systemic problems, review your business processes and software settings.

• In contentious or complex cases, consult VAT experts familiar with UAE specifics.

Completing this checklist is an investment in the safety of your business and the best way to avoid FTA fines.

1. VAT Registration

• Check the relevance of registration data with the FTA.

• Compare current turnover with mandatory (375,000 AED) and voluntary registration thresholds (187,500 AED).

• If necessary, submit a deregistration application in a timely manner.

• Preventing fines: implement a monitoring system for turnover, especially for seasonal businesses, to foresee when you will reach the threshold.

2. Accounting and Documentation

• Maintain full accounting records: income, expenses, cash flows, fixed assets, inventory, salaries.

• Keep all primary documents (invoices, credit and debit notes, contracts, customs declarations).

• Adhere to storage periods: 5 years for normal transactions, 15 years for real estate transactions.

• Be prepared to provide documents in Arabic upon the FTA's request.

• Preventing fines: automate document storage and ensure regular reconciliation with banking and licensing data.

3. Classification of Supplies and VAT Rates

• Ensure that all transactions are correctly classified as goods or services.

• Check the accuracy of applied rates: 5%, 0%, or exemption.

• For zero-rated transactions, keep a complete package of supporting documents.

• Correctly account for composite (mixed) supplies.

• Preventing fines: document in contracts what is supplied and which rate applies to avoid disputes with the FTA.

4. Tax Invoices

• All outgoing invoices must contain mandatory details required by the FTA.

• Check incoming invoices: ensure the supplier's TRN is present and the VAT amount is correct.

• Credit and debit notes must meet the FTA's requirements.

• Preventing fines: use automated invoicing systems and implement a double-check of documents.

5. VAT Declarations

• Meet the deadlines for submitting declarations.

• Check the accuracy of outgoing and incoming VAT amounts.

• Reconcile the declaration data with the accounting records.

• Specify supplies according to the correct Emirates.

• Submit zero declarations if no transactions occurred.

• Preventing fines: for larger companies, conduct a monthly internal data reconciliation before filing the declaration.

6. Place of Supply

• Analyze and correctly determine the place of supply for goods and services.

• Consider the specifics of cross-border transactions, digital services, and real estate services.

• Preventing fines: if in doubt, refer to the FTA's clarifications (for example, VATP040) and consult experts.

7. Reverse Charge Mechanism (RCM)

• Identify all transactions subject to RCM (import of goods and services from non-residents).

• Correctly reflect such transactions in the declaration: account for and claim deductions.

• Preventing fines: maintain a separate register of non-resident suppliers and check it before each declaration submission.

8. Transactions in Designated Zones (DZ)

• Understand how the special VAT regime for DZ where you conduct business operates.

• Check the correctness of rate application for goods and services in/between/from DZ.

• Keep customs and transport documents that confirm transactions in the DZ.

• Preventing fines: remember that DZ status does not exempt you from VAT when consumed on the mainland or if procedures are not followed.

9. Input VAT

• Document all input VAT amounts claimed for deduction.

• Do not include in the deductions expenses where this is prohibited (for example, certain types of entertainment).

• Check the correctness of deductions for imported goods.

• Preventing fines: use a checklist for expenses that cannot be claimed for VAT deductions.