UAE businesses could be granted an extension to the first tax period for those subject to VAT, the Federal Tax Authority (FTA) has said.
This decision is a response to the calls of many authorities and institutions who have been subject to VAT, which came into force on 1st January.
Khalid Ali Al Bustani, Director-General of the FTA, said that the move is part of the authority’s desire to assist companies in achieving full tax compliance and provide them with the appropriate assistance, under the Decree of Federal Law No. 8 for 2017 on VAT and its executive regulations.
He added that the amendments, to be applied to several businesses, include extending the accounting tax period by “one to three months” for some businesses and amending the quarterly tax period, scheduled to end during the first tax period at the end of January or February, to end on the second tax period.
The tax period for some businesses will, therefore, be four months, and five months for other businesses while businesses with a three-month tax period ending in March will not be affected by the amendments, he added.
Al Bustani stressed that the authority is communicating with all sectors to discuss ways of overcoming their obstacles, to ensure the smooth adoption of the new Emirati tax system and achieve their desired goals.
He also noted that companies can view the amendments to the first tax period by logging into their accounts on the e-services portal on the FTA’s website.
According to UAE law, the basic tax period is three months from the date set by the FTA, and the authority has the right to set a shorter or longer period for individuals or a group of individuals if it decides that the non-essential tax period is necessary.
As per the regulations, the tax declaration must be submitted to the authority no later than on the 28th day after the end of the relevant tax period.