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Dynamics 365 Community / Forums / Microsoft Dynamics AX (Archived) / VAT for UAE
Microsoft Dynamics AX (Archived)

VAT for UAE

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Posted on by Prakash P 800

Hello,

UAE government is planning to introduce VAT from Jan-2018. Currently, I am not able to see any VAT related screens/functionalities in our AX 2012 R3 environment and I believe this is because of our country/region selected as “UAE” in AX.

How to enable the VAT functionality in AX for the UAE region? Will Microsoft release any localization to handle VAT for UAE?

Please advise.

Thanks

Prakash

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  • Suggested answer
    Ludwig Reinhard Profile Picture
    Ludwig Reinhard Microsoft Employee on at
    RE: VAT for UAE - AX 2012 R3

    Hello Prakash,

    Has it already been decided that VAT will be introduced or is it just a 'plan'?

    If it has been decided recently, I would suggest that you contact the MS support directly as they will be able to help you with possible changes in local functionalities, etc.

    Best regards,

    Ludwig

  • Prakash P Profile Picture
    Prakash P 800 on at
    RE: VAT for UAE - AX 2012 R3

    Thank you for your reply and advice, Ludwig.

    Government has decided already but not officially announced as a Law and we are hoping that the law will be released in a month.

    I will keep you updated if I get anything from MS.

    Thanks

    Prakash

  • Suggested answer
    guk1964 Profile Picture
    guk1964 10,888 on at
    RE: VAT for UAE - AX 2012 R3

    Its effectively law for the GCC, the accord was signed earlier this month in KSA details are expected by end June. Its unlikely there will be localisation any time soon  - its expected to be to be built on UK/European logic, but there will be differences  due to free zones, whether tourists can reclaim VAT etc.

  • Suggested answer
    Ludwig Reinhard Profile Picture
    Ludwig Reinhard Microsoft Employee on at
    RE: VAT for UAE - AX 2012 R3

    Hi,

    If you have a country-specific requirement MS is not aware of or if you are waiting for the release of a new country-specific hotfix / solution, check out the regulatory alert functionality

    ax.help.dynamics.com/.../inform-microsoft-about-countryregion-regulations-alerts-and-track-status-of-regulatory-features

    mbs.microsoft.com/.../msdaxlcsregsubservice

    Best regards,

    Ludwig

  • Prakash P Profile Picture
    Prakash P 800 on at
    RE: VAT for UAE - AX 2012 R3

    Thank you, Ludwig. I tried contacting MSFT through different sources(Partner Source Support/MBS Query/ Local Call Center) but there is no positive response about the localization.  I am wondering why there is no plan from MS to accommodate the  new tax law by GCC countries.

  • Suggested answer
    Ludwig Reinhard Profile Picture
    Ludwig Reinhard Microsoft Employee on at
    RE: VAT for UAE - AX 2012 R3

    Hi Prakash Prasannam,

    I do not know the specific requirements for UAE. Maybe - as Magic1949 mentioned - you can use the already existing standard features? Are you familiar with them and have to tried comparing them with the UAE country-specific requirements?

    Best regards,

    Ludwig

  • Community Member Profile Picture
    Community Member on at
    RE: VAT for UAE - AX 2012 R3

    Hello Prakash, 

    As a Microsoft Gold Partner based in UAE, we've been getting a lot inquries in regard to VAT, as you correctly said, the UAE goverment hasn't announced an exact framework for VAT.

    The GCC’s unified agreement for value added tax (VAT) has recently been published (in Arabic only) by the
    Saudi Ministry of Finance on their website.

    This unified agreement sets out the framework under which VAT can be implemented in each of the
    GCC member states. The framework includes agreement on certain matters but still allows member
    states discretion on how to treat others.

    Once the agreement is ratified, each member state can issue its own local law and implement VAT.

    The UAE intends to implement VAT with effect from 1 January 2018 but other states may take another 6 months or so.

    The framework paves the way for implementation, for a basic rate of VAT of five percent with certain supplies of goods and services zero rated or VAT exempt. We understand that the Ministry of Finance (MoF) will release the UAE’s law on VAT towards the end of June. This will detail how the UAE will interpret the GCC framework and how it will deal with those matters where it has discretion. These will include whether to treat certain supplies as zero rated or VAT exempt.

    The local law will detail conditions for:

    • VAT deductions,
    • VAT grouping
    • Rules for recovering VAT in respect of financial services
    • Reporting formats

    There is no indication of how VAT will apply to free zones.

    The MoF has recently been holding a series of public awareness sessions, outlining how they
    propose to apply VAT to those areas where the GCC framework allows discretion. The UAE has also
    taken steps to set up its own Federal Tax Authority (FTA), which will be responsible for all VAT
    matters in the UAE.

    The framework provides information to start planning for VAT.

    VAT will impact all businesses in the UAE, either directly or indirectly.

    We have already have about 70+ implementations and received several dozen inquires to assist with this transition, if you need assistance with your business systems to comply with VAT then contact me on salman@bemea.com :) 

    Hope this helps! 

  • Prakash P Profile Picture
    Prakash P 800 on at
    RE: VAT for UAE - AX 2012 R3

    Hi Dr. Ludwig,

    I am looking to analyze/use the existing AX VAT functionality i.e. currently available for UK/India but as I asked before VAT related screens are not enabled in our AX 2012 R3. Do we need to enable through customization? Any ideas/advise?

    Thanks

    Prakash    

  • Suggested answer
    Ludwig Reinhard Profile Picture
    Ludwig Reinhard Microsoft Employee on at
    RE: VAT for UAE - AX 2012 R3

    Hi Prakash,

    In general you should be able to access the sales tax setups in GL. The sales tax code/group/item group forms are generally not bound to a country key and should be visible in your system environment so that you can use them for analyzing and testing the standard VAT functionality.

    Best regards,

    Ludwig

  • Suggested answer
    guk1964 Profile Picture
    guk1964 10,888 on at
    RE: VAT for UAE - AX 2012 R3

    With regard to Salman Rabith comment it is cut and pasted straight from the Synergy Software Systems blogsite, so you might be better talking with them.

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