Since
the introduction of VAT in 2018, UAE businesses have faced an evolving
regulatory landscape. Staying ahead of the latest VAT updates is critical to
avoid fines and maintain smooth operations.
Key VAT Updates in 2025
·
Mandatory E-Invoicing: As of
January 2023, all UAE businesses must issue and store electronic invoices
compliant with FTA standards. This requirement continues to expand, with
stricter enforcement in 2025.
·
Enhanced Documentation: The
FTA now requires more detailed supporting documents for VAT claims, including
contracts and proof of supply.
·
Updated VAT Treatment: New
clarifications on exempt, zero-rated, and standard-rated goods and services
have been issued, affecting sectors such as education, healthcare, and real
estate.
·
Penalties and Fines: The FTA has increased
penalties for late VAT returns, inaccurate filings, and non-compliance with
e-invoicing regulations.
Common Mistakes Leading to Penalties
·
Late or incomplete VAT filings
·
Failure to issue compliant e-invoices
·
Incorrect VAT classification of goods or services
·
Poor record-keeping and documentation
How to Stay Compliant
·
Implement robust accounting software with VAT tracking
features
·
Train your finance team regularly on the latest VAT rules
·
Conduct periodic internal VAT audits to catch errors early
·
Partner with VAT specialists to navigate complex regulations
Jesser Al Najah LLC: Your VAT Compliance Partner
We
provide comprehensive VAT consultancy and compliance services, ensuring your
business adapts to regulatory changes seamlessly. Our proactive approach helps
you avoid fines, optimize VAT recovery, and maintain full compliance with the
Federal Tax Authority’s latest requirements.
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