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New year brings opportunities to Indian CAs in form of UAE VAT

VAT (Value Added Tax) would be implemented from January 2018 in UAE and would be joining the cluster of 150 nations where VAT has been implemented already. The government of UAE has taken all the positive steps in the progressive direction.

This was affirmed by CA Naveen Sharma, the newly elected Chairman of ICAI, Dubai. With 27 years of experience as a qualified chartered accountant, Naveen is an outstanding professional in the field of accounting and finance beside being detailed-centric result oriented. The 49-year-old has lived in Dubai two decades and is not only a Chartered Accountant but also a Company Secretary. He is also a Certified Internal Auditor (CIA) from the USA. In the past, he has also been the President of Indian Charted Accountant of Toast Master Club (ICAT).
The Chairman expressed his confidence that the implementation of VAT would further boost UAE s economic growth and consequently create more jobs. He also mentioned that ICAI is planning to work more closely with FTA (Federal Tax Authority) for educating the businesses and public about this monument move.

Chartered Accountant as a profession and its demand in UAE/Dubai
Indian CAs, who have gone through the meticulousness of implementing and interpreting the GST (Goods and Services Tax), are in great demand in UAE and other countries nowadays.

It is the first time where a major levy has been introduced in the Gulf, and businesses are in need of in-depth training to appreciate the intricacies involved. As this would impact the end consumers too since the VAT would be finally passed on them. The sectors where CAs are required include real estate, oil and gas, and retail. Oil and gas is the backbone of Gulf. As most of the industries are associated with it, VAT would have its applicability at every stage.

In UAE, the accounting profession has been growing extremely with the growth of its economy. Accounting as a profession has grown steeply in the UAE and Indian CAs are highly considered for their knowledge and professional integrity. The profession has persistently endeavoured to keep up with pace with the ever-growing business requirements coming from the substantial growth in the country s economy observed over the years. From being supposed to be a peripheral service, the accounting profession has advanced to a pivotal one, in the business line of services. Most of the major international accounting firms have grown their presence in the country.

The Middle East and in specifically the UAE, has been at the forefront of the minds of most of the expats over the years. While there are several challenges to overcome, largely there is undeniably a positive sentiment in the region around talent attraction. However, it is essential to remember that UAE remains an attractive social and business hub with huge growth prospects. Though western business culture has been incorporated into the professional environment, the business and social cultures and anticipations in the UAE might alienate and surprise an unprepared traveller. When preparing for a posting in the UAE, it is important to acquaint yourself with the culture, professional customs and social expectations of the country. Developing appropriate and effective communication is an important factor in developing productive and successful working relationships and business strategies in the UAE.

What is Vat and how does it work

VAT (Value Added Tax) is a form of indirect tax which is applied to the consumption of goods and services. It is levied by the VAT-registered businesses making supplies of goods and services in course or continuance of the business. VAT would also apply on the import of goods. It is levied at every stage in the supply chain and collected by the businesses. VAT is eventually borne and paid by end consumers. Though VAT would apply to most of the goods and services, there are few likely exemptions which include essential medicines, basic food items, and exports of goods and international services.

Businesses registered with VAT charge and include VAT to their goods and services. Such businesses could also take input credit of VAT incurred on goods and services used in their business such as the procurement of raw materials and several other consumables to be in the course of business.

VAT in Dubai

As per the executive regulations on VAT published in the first week of December, the threshold for mandatory registration is Dh 375,000.
It means that businesses having a turnover of Dh375,000 or more are required to register for VAT.

The threshold for voluntary registration is Dh187,500. The failure of businesses or taxable person to submit their registration application under the specified time is liable for a Dh20,000 as a penalty. Also, as per the executive regulations, companies can register as tax groups. Under this mechanism, companies could register for the purpose of VAT as a group, under the single common control. The key benefit of this mechanism is to simplify and shorten the procedures and reduce costs via a single VAT registration and consolidated tax returns.
Moreover, the tax payments and returns of the group is carried out by a member who would act as a representative of such group, however, all the members will be jointly liable.


As the deadline for VAT implementation (January 1, 2018) is around the corner, the Indian accounting and tax professionals with experience in implementing VAT-model tax systems are finding the UAE appealing for their careers. This introduction of the VAT is similar to the GST rollout that became effective in India from July this year. There is a huge presence of Indian companies in UAE and for whom the tax and accounting professionals from India would be a natural choice.


Naveen Sharma

Chairman - ICAI UAE (Dubai) Chapter & Director Internal Audit at Al Shirawi Group

ICAI Bhawan, Post Box:500725 G-18, Block 2B, Knowledge Village Dubai, United Arab Emirates

CA, Chairman - ICAI UAE (Dubai) Chapter & Director Internal Audit at Al Shirawi Group


CA (The Institute of Chartered Accountants of India)





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