Reverse Charge Mechanism (RCM) Practical Explanation | Imports of Goods / Services | VAT UAE FTA TAX

Reverse Charge Mechanism is a treatment of VAT that comes into play in the case of an import of service or goods. This may be a bit confusing for businesses especially start-ups who face challenges when filing their VAT returns.
Bottom Line - Reverse charge mechanism or RCM is mostly only for disclosures however, Filing VAT returns correctly is important to avoid penalties. Being compliant with the tax regulations is important.
#vat #rcm #imports #uae #tax #business #exports #trading #dubai
To read more about it click here www.msiauditors.com/reverse-c...
Timestamp
0:00 Intro on Reverse charge Mechanism
0:57 Simple explanation of Reverse Charge Mechanism (RCM) in the UAE
2:03 How to disclose RCM When filing VAT returns
2:57 Example of an actual tax impact of RCM
3:40 Outro on RCM
To have a quick free consultation you can get in touch with us at [phone] or [phone], during our office hours. Alternatively, you can get in touch with us at [e-mail]
Website- www.msiauditors.com/
Facebook- / msialnomanandravi
Linkedin- / msi-alnoman-&-ravi
Instagram- / msiauditors
Twitter- / msiauditors
Tik Tok- www.tiktok.com/@msiauditors?l...
We are one of the oldest audit firms based out of UAE, with over 30 years of experience. This makes us one of the pioneering audit firms in the UAE. We are experts in Audit, Accounting, Taxation & Consultancy related services. Get in touch with us for more professional advice on your company's VAT compliance requirements in UAE.
Audio credit-
Music: Soft Corporate by NewHOfTechnology
/ ewfechnolohy
Video Link: • NewHOfTechnology - Sof...

[@farrukhsami7851]

Can u make one video by doing practical entry in any software how to do entry

[@rajabconstructionco.9973]

Very good information helpful and great advice excellent explanation valuable video thanks you God bless you always brother sir jai hind 🇮🇳 I am from India 🇮🇳 jazak Allah hu khair brother

[@MSIAuditors]

Always welcome

[@muhammedajsal997]

Hi could please tell how do we claim the vat paid at the time of clearance of good from customs. Since its vat is already paid at the time of import and if we show vat as input and output, then it means we are claiming the input vat right. Could please explain on this

[@BestMovieClip99]

Watching and explaining from laptop 😃😃. But good 👍

[@ahmedrafaa273]

Hey, Good morning sir, Could you please explain how to register a Group VAT and how its work? Please advise. Thank you. Regards Ahmed

[@bleesedhour]

Hi good day, please I have a question I missed to reverse the amount in box 10 in filling of the vat return, company is a vat registered. Can I claim the same in the next filling in row 10 ?

[@MSIAuditors]

That is a good question. If the VAT impact of it is under 10,000 AED, you may correct it in the next VAT return.

[@bleesedhour]

@@MSIAuditors yes thank you so o much 👍

[@hadislibrary1325]

Sir Plz explain if imports from USA etc is 204606 custom duty is 10330 vat is 10846 now if there is no sales and Vat on expenses is 10000 can we claim 10846 along with 10000 on expenses or not? And if we can reclaim it under RCM where we will enter the amout is it will be in the adjustment column in box 9. Plz reply urgently

[@muhammadakbar9049]

Hi. How the vat paid on import of goods made before vat registration will be treated in the first vat rerurn filing of a company? In which serial number it will be posted and would it be subject to RCM?

[@mohammedabdulsamad1833]

I am also looking for the same answer. please let me know if you got the response

[@muhammadhabubacker8890]

End of the video you mentioned an additional 5% payable for the import of the car. Normally any import of goods crossing the border will pay a VAT @ 5%. Does it mean the total VAT payable will be 5% + 5% = 10%?

[@MSIAuditors]

No it just means you will not be able to claim back the VAT that was paid.

[@muhammadhabubacker8890]

@@MSIAuditors thanks for the reply

[@shivangigarg6963]

Where to report import and export exempted supplies?

[@MSIAuditors]

Can you clarify your question with an example?

[@Nabeelaj]

As a software company registered in Dubai, we invoice our UAE-based customers with 5% VAT. Additionally, we outsource software development work for our Dubai-based clients to India, receiving invoices from our Indian suppliers for these services. I want to know how to correctly account for these supplier invoices with the Federal Tax Authority (FTA) in the UAE.

[@Abdulhadi-vz5bo]

Can you elaborate RCM in case google Ireland ads services

[@MSIAuditors]

If VAT is charged for the services by google, not RCM to be recorded, otherwise the RCM needs to be recorded.

[@BestMovieClip99]

@@MSIAuditors didn't get the point.

[@MSIAuditors]

@@BestMovieClip99 The point here is that, if there is someone in UAE to account for the VAT for the supply in UAE, then No RCM is to be done. RCM comes into play only when there is nobody here to account for the VAT. Hope that makes sense. -MSI Team

[@CA_AmritaSingh]

What if in Oman we are receiving goods from our Dubai entity with no vat on invoices. Our dubai entity is purchasing those from china.

[@MSIAuditors]

If the goods were stored in the mainland after import from china, then yes RCM will need to be conducted. -MSI Team

[@CA_AmritaSingh]

@@MSIAuditorsthanks for the quick response. Our Dubai entity already recording vat on those invoices. Then also in Oman we need to show those as RCM??

[@MSIAuditors]

@@CA_AmritaSingh RCM is to be recorded in each country. So far the GCC VAT has not been integrated yet.

[@CA_AmritaSingh]

@@MSIAuditors Thank you

[@hadipatel5344]

Can we claim RCM for custom duty or excise duty paid??

[@MSIAuditors]

RCM on the VAT can be claimed if it is not related to an exempt supply.

[@hadipatel5344]

@@MSIAuditors thnks. But I want to know about custom duty claiming ? When we import thr goods in Uae

[@MSIAuditors]

@@hadipatel5344 Customs duty can only be claimed in the case of import for re-export.

[@hadipatel5344]

@@MSIAuditors thnk you..👍

[@shivangigarg6963]

Hi, thanks for the video on this topic. Can you please guide me on zero-rated import of service. As per UAE VAT law, "Services received from foreign suppliers which are subject to the zero rate of VAT" should be reported in row 3 and RCM output tax is payable on such supply. On zero-rated supplies, recipient is required to pay tax? Source: tax.gov.ae/DataFolder/Files/Pdf/VAT%20Returns%20User%20GuideEnglishV40%2015%2008%202021%20SEP2021.pdf

[@MSIAuditors]

Any RCM you mention in the output VAT section can be claimed back in the last row if it is allowable.