VAT q&a: 'Do I have to use the FTA's approved software provider to make my tax return?
I’ve heard people talking about Federal Tax Authority accredited
accounting software and can see on the FTA website that there are only
four software providers listed, with most of the well-known names
missing. Is it mandatory to use one of these accredited providers? I’ve
been happily using an unaccredited accounting package since January and
don’t want to change it unnecessarily. LA, Fujairah
The Decree Law and Executive Regulations do not prescribe that a
business must use accredited accounting software to record their
financial transactions and you have rightly noticed that many of the
best known and trusted financial software providers are missing from the
list. As far as I am aware there is also no mandatory requirement for
software providers to become FTA accredited.
One of the key requirements is that it can produce a VAT return file
that integrates with the FTA’s e-Tax portal and automatically populates
the tax return. This means you do not need to manually input numbers
from your VAT reports into the online return, and may reduce the risk of
errors in the submitted return.
However, what is most important is that your accounting software of
choice meets your business needs and fully complies with the VAT
legislation in terms of producing compliant tax invoices and credit
notes. Further, that it captures key data to facilitate submission of
your quarterly returns and is also capable of being audited in detail by
the FTA should they wish. The FTA require that VAT records are retained
for a minimum of five years so the system should be effectively backed
up and archived for the required period. I suggest you read the sections
in the Legislation and Executive Regulations covering tax invoices and
credit notes , and record keeping. These start at articles 65 and 78 of
the Decree Law, and articles 59 and 71 of the Executive Regulations. As
long as your chosen accounting system allows you to fully adhere to the
FTA requirements there is no issue with it not being accredited
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