Tax audit services
RVG Chartered Accountants
A tax audit is a formal examination conducted by the FTA to verify information or uncover fraud and inaccurate tax returns.
The Tax Procedures Law (Federal Decree-Law no. 7), issued by the Ministry of Finance defines Tax Audit as a procedure undertaken by the Authority to inspect the commercial records or any information or data related to a Person conducting Business.
FTA may perform the Tax Audit at its office or the place of business of the Person subject to the Tax Audit any other place where such Person conducts Business, stores goods or keeps records.
How To Avoid Audits?
Keep Good Records.
Keeping your business expenses and financial gain managed out of a separate business bank account is prudent. Keep all receipts associated with business expenses. confirm you'll be able to justify all business diversion expenses and deductions.
Check the Math.
If you receive a 1099 kind, confirm you report it accurately. The government agency can receive a duplicate of that form. If you come back is prepared by a 3rd party, have them walk you through the calculations and how the calculations about the records you’ve provided.
Pay Estimated Taxes.
If you expect to owe more than $500 in taxes, be sure to file quarterly tax payments. Failure to do therefore may result in penalties and increased audit risk.
Don’t Use Contractors as Employees.
Some businesses use independent contractors to skirt payroll taxes. The federal agency has clear guidelines on how employees will be classified; make sure to follow those guidelines and ask for advice if unsure.
How to be prepared for an audit?
As the Federal Tax Authority (FTA) in the UAE conducts tax audit of the companies, it is important to be meticulous with the tax reports to avoid non-compliance penalties. RVG Chartered Accountant – UAE delivers Tax Audit/VAT Audit services to enable clients in the UAE to face tax audit with accurate financial and tax records. We make sure that our purchasers meet all the tax audit needs.
A tax audit is an assessment program run by a government under which it examines a company on the basis of their responsibility as a taxable entity. This audit is entirely conducted by the Federal Tax Authority (FTA) in order to make sure every liability is paid and all the due tax is collected and further submitted to the government with the given period of time.
Review of the taxation system
Review of Calculations Tax
Review of VAT returns
Review of payment of Tax Due
How long will it take to perform an audit?
- The type of audit
- The number of records to be reviewed
- The quality of the audit
- The availability of the requested records
- The availability of all parties associated with the audit
- And the taxpayer’s level of agreement or disagreement with the audit’s findings.
What is a tax audit?
A tax audit in UAE is basically a government’s assessment of an organization about its responsibility as a taxable entity. This kind of audit is performed by the Federal Tax Authority (FTA) to check that every liability is paid and every tax due is collected and given to the government within the timeframe provided. The government also ensures whether a company is fulfilling certain responsibilities that apply to their business as per UAE tax laws (VAT Law, Excise Tax Law, etc.)
Here’s the detailed procedure of tax audit in the UAE
- The concerned party/business/person in UAE will file their tax returns on the FTA portal according to the schedule.
- The FTA authorities will examine the returns and other details. There can be a no specific reason for the FTA to conduct an audit of a business/taxpayer. They can perform it for any reason or whenever they want.
- The concerned party will be issued a notice, a minimum of 5 days before the scheduled audit date. The notice will contain details about audit schedule, place, involved parties and reason if there is something particular.
- Note: The audited party has the right to request for the credentials, such as professional identification cards, from the tax auditors in order to check their authority.
- The auditor/s and the taxpayer will gather at the scheduled place at the scheduled time and the process will start. The auditor can ask for original/copies of business records and may take samples of goods and other assets if available at the place during that time.
- The taxpayer/ business subject to a tax audit, along with their legal representatives and tax agents, are obligated to offer complete assistance to the auditors carrying out their task.
- If anything doubtful or wary is found in the result of the audit that can have an impact on a tax return, the authority may order a re-audit for additional analysis.
It is also recommended to find and hire an experienced company so that their team of tax audit consultants would be able to help you manage the taxing season. A majority of such companies offer no-obligation consultation or they would probably send their executive to you to explain to you all about tax, tax audit and the pre-tax audit.