Why is a Platform a good idea for VAT Compliance
What is UAE VAT?
The UAE government is going full steam ahead with the implementation of a value added tax (VAT) in the country from January 1, 2018. The Federal National Council (FNC) approved the draft law and the final law is waiting for the presidential approval. With the imminent VAT implementation, tax practitioners, technology consultants and relevant government departments are gearing up for the new tax regime in the country.
Why you need an ERP for VAT?
Preparing monthly tax returns is often dreaded as the thought of pulling backup, reconciling transactions, and preparing reports is time consuming and takes a lot of effort. TAXWORX has a Value-Added Tax (VAT) Software solution that will prepare the detailed and summarized reports needed for tax filings.
VAT is the taxes on goods and services used throughout various countries. A VAT Report will produce a summarized tax report that can be used to remit taxes. It will summarize the total taxes charged on sales and total taxes paid to vendors. It will also produce a finalized tax return form used to remit.
Traditionally, users use the general ledger and/or trial balances to remit taxes.
However, with the VATSolve, it can now automatically produce the report without manual updates/manipulations to prepare a tax return report.
The advantage of using a VATSolve is that it will capture any transactions posted to prior periods that were not remitted in the tax return. It will eliminate reporting errors when a user reports using the general ledger.
This function also allows a user to review the tax return before submitting. The draft and finalized reports are easy to follow and for readers that need to review before submitting, the reports generated have a systematic flow and a reader does not need to flip back and forth between pages to find a trail of where figures are coming from.
VATSolve help you to reduce your end moment pressure for calculating the VAT.
Benefits of VATSolve:
The automated configuration of VAT within an ERP system is essential to:
- Correct calculation of output VAT
- Correct and compliant invoicing
- Correct recovery of input VAT
- Effective and accurate VAT and statistical reporting
- Streamlined month-end reporting processes.
“Best in Class” VAT automation in an ERP system depends on the correct configuration and linking of sophisticated tax functional elements across materials, sales and finance modules.
Areas to consider?
The areas that a company will need to consider from a VAT perspective when implementing an ERP system are:
- Tax relevant master data
- Tax condition rules
- Tax codes
- Invoicing and documentation