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  • Tax impact to consider during the COVID-19 Learn More

Tax impact to consider during the COVID-19

29 March 2020

With the evolving crisis we are facing globally in the form of COVID-19, the health and safety of our friends, families and community has become a priority. This has resulted a change in how we do business, with work from home arrangements becoming more common.

It is important that despite the change in our day-to-day lives we continue to support our clients in meeting their tax obligations in these tough times.

Deadlines for the notification for Economic Substance Regulations (ESR) have been deferred by both Dubai International Financial Centre (DIFC) and Abu Dhabi Global Market (ADGM) authorities. This deadline was previously set at 31 March for these two authorities. A revised deadline has yet to be announced.

Currently there has been no extension of deadlines for the filing of VAT returns nor there is any deferment of the payment deadlines.

BDO UAE’s VAT compliance solution, which is developed by Thomson Reuters and adopted by BDO, allows us to assist clients in the preparation of their VAT returns off-site. It is a cloud- based solution which means both BDO and our clients can prepare their returns from anywhere around the world. Therefore, we do not expect significant challenges to impact our VAT compliance clients.

The nature of VAT is such that large sums of money pass through taxpayers’ hands before being eventually paid to the FTA. Optimising the VAT cashflow through the business can make a real difference to overall cash flows.

Things to consider include:

  • Making your refund applications more quickly.
  • Is there any bad debt relief to be claimed?
  • Is VAT claimed on purchases at the earliest possible time?
  • Are you claiming all the VAT you are entitled to?
  • Our team will continue to provide advisory support in these challenging times with the same quality and professionalism as always. We are committed to finding innovative ways to ensure that deadlines continue to be met despite the circumstances. Meetings and discussions will now happen over conference calls, Microsoft Teams or Skype for business. Our team will continue to be contactable during our normal working hours.