VAT is a governmental tax which is imposed upon businesses operating at any level for value addition to the offered products across the supply chain. The duty is imposed at any POS (Point Of Sale) from manufacturer till the product is sold to the consumer end. It is acquired by permitting paid tax on purchased product called “Input VAT” or “Tax Credit” that is later adjusted with “Output VAT”. The output VAT is collected on product sales and hence complete tax is paid at consumer side.
VAT software in UAE is specifically developed by considering the VAT taxation requirements of a particular nature where the business is formed. It handles all necessary operation like tax returns, vouchers, receipts, customer invoices and sales orders.
It helps in ensuring that every financial transaction is recorded with up to date and accurate account book keeping. This is due to the fact that account books acts as evidence for minimum annual business turnover threshold limit for registration. On such basis, it is mandatory to register or request for getting exempted from registration.
VAT software allows business to turn as VAT ready that means the companies have to charge VAT on taxable products, get accounted for paid VAT on the product purchases where input tax deduction is claimed and finally the business file for online VAT returns in an automated manner on a regular basis where the details of charged and paid VAT are disclosed. VAT readiness can be explored efficiently by the help of VAT software and makes the company VAT compliant that also assists in transiting seamlessly into new era of VAT.
The implementation of VAT software helps in understanding the fundamentals of VAT compliant business and necessary business implications.
Businesses are able to foresee business decisions in a way to make changes in their financial management, business operations, account book keeping and many other things that comply fully with VAT requirements.
There are different types of VAT software in UAE that allows keeping track of bank transactions while reporting business data and it is user friendly. It also allows multi users and gets a realistic estimate of inventory and return.