• Malik, Bur Dubai, UAE

VAT Audit

vat audit

Professional VAT Audit Support for UAE Businesses

Business Tax in UAE (BTU) provides professional VAT Audit Services in UAE to enable businesses to remain in compliance with Federal Tax Authority (FTA) regulations, reduce the risk of penalty payments, and to assist in preparing for official audits. Value Added Tax (VAT) came into force in the UAE on 1 January 2018, pursuant to Federal Decree Law No. 8 of 2017 on Value Added Tax (as amended). The FTA is now closely monitoring that businesses properly register, collect, report and pay the standard rate of VAT of 5%.
Our VAT Audit Services in Dubai and the UAE include:
  • Proactive VAT health checks
  • Pre-audit readiness reviews
  • Assistance with FTA audits
  • Voluntary disclosure support
  • Post-audit fixes
  • We find mistakes early, rectify them quickly, and make sure you are in compliance.

What is a VAT Audit in UAE?

A VAT audit (or tax audit) is an official audit conducted by the FTA on a business’s records, VAT returns, documents and invoices. The purpose is to verify that the business is in compliance with the UAE VAT Law and the Tax Procedures Law. Under Federal Decree-Law No. 28 of 2022 on Tax Procedures, the FTA may audit any person, having given at least ten (10) business days’ notice of its intention to commence the audit, except in cases where tax evasion has been suspected. The FTA may conduct audits at its own office, or at a business’s premises, or at any place where records or goods are possibly kept. The FTA may also select between:
Desk audits – advance copy checks on documents
Field audits – on-site inspections
The decision for audits is usually risk-based (e.g. large VAT refunds claimed, complex arrangements, or situations where VAT returns do not match financial statements), but may also be routine.

Why VAT Audit Services Are Essential for UAE Businesses

The FTA audits focus on accurate output tax, input tax claims, correct classification (standard rated, zero rated, exempt), the proper invoicing, timely filing and payment, and complete record keeping. Failure to comply may lead to tax assessment, administrative penalties and eventually more severe sanctions under Tax Procedures Law in case of serious violations.
The professional VAT Audit Services in UAE by BTU include the following benefits:
  • Identifying and correcting issues before the official VAT audit notice is issued by the FTA.
  • Voluntary disclosure (where applicable) reduces the risk of penalties.
  • Reconciliation between VAT returns and accounting records/financial statements is strengthened.
  • Documentation and audit trail are well maintained.
  • Full representation and communication with the FTA throughout the audit process.
  • Improvement of internal VAT processes and controls in the long term.
  • Businesses with organised records and who conduct internal reviews are always in a much stronger position when FTA decides to conduct a review.
Compliance Support
We ensure your VAT records and filings are accurate, complete, and compliant with FTA requirements.
Reliable Service
All business and financial information is handled with complete confidentiality and professionalism.

What the FTA Examines During a VAT Audit

Common focus areas include:
  • Output tax – proper application of 5% VAT, zero-rating (with evidence such as export documents), exempt supplies
  • Input tax – admissibility of claims, supporting tax invoices with correct TRN, blocked inputs (e.g. certain entertainment expenses and personal vehicle expenses), proper apportionment of mixed supplies
  • VAT returns – consistency with underlying ledgers, trial balance, and financial statements
  • Invoicing and documentation – proper tax invoices, credit/debit notes and proper sequencing.
  • Special schemes and mechanisms – Reverse charge mechanism (RCM), designated zone treatment, margin schemes, etc.
  • Systems and records – accounting software capability (including generation of FTA Audit File / FAF where required), stock / inventory alignment, and import / export documentation.
  • General compliance – registration, filing, payment and record keeping.

Records You Must Maintain (Official Requirements)

According to the UAE VAT Law and related rules (under Article 71) and the Tax Procedures Law; taxable persons shall maintain complete and accurate records for a minimum of five (5) years after the end of the tax period they relate to. In some cases longer periods are required (e.g., for certain real property records, 15 years from the end of the tax period to which such records are related). These records have to be maintained so as they can be provided to the Federal Tax Authority (FTA) at any time (in Arabic or English language) when requested and retrieved easily.
Important records:
  • All issued and received tax invoices
  • Tax credit and debit notes
  • Records of all supplies (sales) and imports of goods and services
  • Customs declarations, shipping documents, and export proof for zero-rated supplies
  • Accounting records, ledgers, trial balance and VAT return workings
  • Bank statements and payment evidence
  • Contracts relating to important or complex transactions
  • Records for goods or services that input tax has not been claimed
  • Information on any adjustments and voluntary disclosures
  • Failure to maintain or submit these records may be subject to penalties.

Our VAT Audit Services in UAE – How BTU Supports You

  • Pre-Audit / VAT Health Check: The past VAT returns, accounting records, input/output tax calculations, invoicing and reconciliations are reviewed. We identify gaps, risk and make recommendations, such as voluntary disclosure if applicable.
  • Audit Readiness & Documentation Support: We ensure all your VAT records and documents are in order, your VAT accounts and returns are up to date and sufficient audit trails exist. We will also check that your FTA Audit File test is correctly prepared.
  • During-Audit Support: We respond to FTA requests timely, prepare and index documents, provide on-site or remote support, and represent you professionally.
  • Post-Audit Assistance: We Review FTA findings or assessments, work within legal constraints to respond to findings and objections, apply fixes and enhance processes to prevent future problems.
  • Ongoing VAT Compliance Advisory: We support VAT Registration, VAT returns, Reverse charge Mechanism (RCM), Input Tax Recovery and staying up to date with the latest VAT clarifications from the FTA.
  • Our skilled tax team has a deep understanding of the FTA procedures and how Federal Decree-Law No. 8 of 2017 (VAT) and Federal Decree-Law No. 28 of 2022 (Tax Procedures) apply.

Why choose Business Tax in UAE (BTU) for VAT Audit Services?

  • We have in-depth knowledge of FTA audit procedures and findings.
  • Our VAT Audit Services are focused on providing the most accurate and practical advice relating to VAT in the UAE, in line with the official UAE tax portal (tax.gov.ae) and relevant UAE laws and decree laws.
  • We apply a tailored approach to assist businesses of all sizes from diverse industry types.
  • Reduce Risk and increase efficiency and compliance in VAT Management.
  • We make sure that you receive the necessary and timely information and support in all phases of your tax audit work from start to finish.

Contact Our Team for Expert VAT Audit Assistance

Protect yourself from unnecessary penalties. Make sure your business is audit-ready. Contact Business Tax in UAE (BTU) to benefit from professional VAT Audit Services in UAE.

VAT Audit FAQs

According to Federal Decree-Law No. 28 of 2022, the FTA generally must give at least 10 business days’ notice prior to initiating a tax audit. (There are exceptions in case of suspected tax evasion)

At least five years from the end of the tax period concerned. (There are exceptions for certain real estate records.) The records must be available upon the FTA’s request.

 

Yes, your ability to disclose any errors beforehand (when eligible) through voluntary disclosure prior to an audit notice can reduce penalties. The manner in which you correct or disclose errors at the time of the audit is also of importance, as timely cooperation and accurate responses are important.

 

The FTA generally notifies the taxpayer of the outcome of the audit. The taxpayer has the opportunity to examine the assessment basis. There are time limits for any reconsideration or objection under the Tax Procedures Law.

 

 

No. The FTA selects a business/s for audit on a risk basis, or through “targeted” audit. However, it is not limited to the selected taxable businesses. It is always best to ensure your business is in compliance at all times.