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How to correct VAT errors?

As we're aware that VAT in Oman will be implemented soon, businesses should be searching for approaches to limit its effect, like returning to their supply-chain models, stopping input tax leaks, and checking tax costs every possible opportunity.

In any case, the standard rate of VAT will be 5%, making it perhaps the most minimal rate on the planet. Also, there are remarkable zero-rated classifications under Oman VAT law, including the supply of certain food things, unrefined petroleum, oil subordinates, natural gas, prescriptions, and medical hardware, and certain vehicle services. Furthermore, VAT exemptions are stretched out to supply monetary services, medical care, and related supplies, education and related supplies, and certain land transactions. Moreover, proper ways have been outlined for VAT Error Correction to avoid any discomfort to the citizen.

With all these changes taking place in the economy, the possibility of using the VAT error correction form is higher. This blog will guide you to Correct errors on your VAT Returns if needed at any time.

What are the VAT Errors?

At sometimes, while documenting a VAT return, you will come across a phrase called VAT Error. A VAT error happens when a taxable individual doesn't charge and account for the right amount of yield VAT or doesn't recuperate the right amount of information tax. This applies whether or not a taxpayer has overpaid or comes up short on the tax amount due to the Federal Tax Authority (FTA). In any case, the amount of tax that is paid to the FTA is incorrect and should be corrected. VAT Error Correction can help you if things go wrong.

How to correct errors on your VAT Returns?

There may be occasions where a tax return that has been submitted to the authority contains an error and results in an alternate amount of tax being due to the FTA, for instance, the amount of recoverable tax is lower than it should have been or potentially the amount of recoverable Input tax is much higher than it should have been. The value of the error will base the manner by which it should be corrected.

In the event that the tax value of the error is AED 10,000 or less, the error should be corrected on the tax return for the time frame in which the error is discovered.

In the event that the error is discovered when it can't be corrected along these lines (for instance, when the taxable individual is no longer VAT enrolled), at that point, a voluntary disclosure should be submitted to the FTA.

If the tax value of the error is more than AED 10,000, the error needs to be disclosed to the FTA through voluntary disclosure.

A voluntary disclosure should be submitted to the FTA within a span of 20 working days of when the taxable individual got to know about the error and utilizing the form asked by the FTA.

With this procedure, you can have your VAT return to correct errors.

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How to find the best vat consultancy in Oman?

Encircled by the Middle East nations, Oman is seen as an open door for capturing different countries, accordingly, permitting business people and entrepreneurs to extend their business horizons. Following the representation of VAT in the KSA, the UAE, and Bahrain, Oman will be the fourth GCC nation to actualize VAT in the region. The standard rate for Oman's Value Added Tax has been decided to be 5%.

The VAT Law will set out the overall principles for the use of VAT in Oman in accordance with the Unified GCC Agreement for Value Added Tax (VAT).

Businesses with exercises in Oman should consider Value Added Tax Consultants in Oman to know about the ramifications of the presentation of VAT on their transactions and make sure that they are prepared to follow the new VAT prerequisites by April 2021.

How to find the best Value Added Tax Consultants in Oman?

Since VAT implementation is still new in Oman, one of the most important things a business owner needs is a VAT Consultant in Oman. Here at R.Tulsian, you can find the best consultants for VAT that would benefit your business and save you from any complications. With the new registrations, VAT treaties and new VAT laws, it can often be difficult and confusing to decide how to work with this recent change. VAT and Tax Consultants in Oman can help in facilitating and can provide you different ways in which you can run your business smoothly in Oman.

Why do you need Value Added Tax Consultants in Oman?

In Oman, there are various types of tax structures that are to be understood by the taxpayer:

Withholding Tax: In Oman, the current retention charge is at a 10% level rate to be paid by the taxpayer to the government on the income received, including interests, profits, proficient expenses, and sovereignties.

Customs Duty: For raising the revenue, this rate has been executed upon export/import of products. It is charged upon products' value based on various boundaries like measurement, weight, and so forth. Oman observes a standard rate of 5%. Fare and import of explicit things like tobacco, liquor, and so on are of 100% rate.

Corporate Tax: 15% is the standard followed corporate tax in the Sultanate of Oman. Business elements are likewise demanded upon an expense based on revenue age.

What is a Tax Treaty?

Two nations undertaking agreements to avoid pointless twofold taxation, from both the countries while doing export-import system, is named as Tax treaties. Oman, till now has signed 30+ expense treaties with various nations across the globe. It is certainly a positive point for all business people and entrepreneurs.

Being knowledgeable with the diverse legal prerequisites can assist with managing the business rapidly, viably, and productively. Examining with the VAT consultant can assist you to all the more likely arrangements with the taxation cycle that is presently being rehearsed in Oman. Therefore, VAT Consulting Services in Oman can be beneficial to the taxpayer in making decisions for their businesses.

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What should be the general scope of Internal Audit in the Gulf?

The ability to run a smooth and successful business depends and your ability to plan ahead and keep up with the latest economic business trends. Whenever you need to make assessments of the future plans for your business you need to carefully rules, regulations and financial laws for an individual establishment in Bahrain. For this reason it is important to hire internal auditors who work at the best individual establishment to ensure you abide by the tax laws and VAT rules in the country. If you are nervous or apprehensive about your first internal audit in Bahrain then you have come to the right place. This blog will give you an overview of all the company formation requirements in Bahrain so that you will get a better understand about the general scope of Internal Audit in the Gulf.

What is an internal audit?

In simple terms an internal audit is an independent and objective assertion of the financial elements of your business operations. Internal audits are important for an independent & individual establishment because it helps to ensure the smooth functioning of your business.

Hiring the best internal auditors in Bahrain will give you valuable insights into all your financial matters in order to tackle business decisions head on. Internal audits will also help to improve the efficiency of risk management and avoid any future chaos when it comes to financial planning.

Why do you need an internal audit?

Apart from the fact that regular audits are part of the company formation requirements in Bahrain; it is essential if you want to guarantee the stability of a company in the future. Every single business operating in the Gulf needs an internal audit to achieve its objective and ensure compliance with applicable laws and regulations.

The main reason why an individual establishment in Bahrain may conduct an internal audit is because they need a re-evaluation of the costs and benefits of business operations. A careful and comprehensive reassessment of the existing system will help business owners and stakeholder restructure the organization to maximize profits.

The examination of the financial and operating information of your business during an internal audit will allow you to identify and rectify any weak links within the processes of the company or in the independent & individual establishment.

Who is an Internal Auditor?

An internal auditor is a financial expert who is well versed with all the Company formation requirements in Bahrain as well as all the VAT and tax laws. In order to avoid unnecessary money loss or government penalties in the future you need to partner with the best individual establishment and get the best auditors in the Gulf to execute all your Internal Auditing Activities. 

An internal audit plays an essential role in the stability and growth of an individual establishment in Bahrain because it covers a variety of factors, namely strategic growth, future business objectives and company expansion. Regular internal audits will help to sustain a good reputation, handle the risk factors and allows your business to grow and flourish in the Gulf.

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What are the requirements for the audits in Bahrain?

A report published in 2011 by the Index of Economic Freedom found that Bahrain had the freest economy in the Middle East. Additionally, it was recognized by the World Bank as a high-income economy. Given these incredible stats, it is easy to see why companies are flocking to Bahrain to set up shop. However, since all companies must comply with the audit requirements and legislation as laid down by the law and executed by the audit firms in Bahrain, you need to familiarize yourself with these requirements if you want your business to succeed.

Since the intricacies of financial law and audits can be a little overwhelming, you should work closely with audit and accounting firms in Bahrain to ensure tax and audit compliance. You can go through this article, in order to get a general overview of the requirements for the audits in Bahrain.

What are the types of Companies in Bahrain? Before you get to the specific audit requirements, you first need to identify that in which category your company comes under. If you want to do business in Bahrain, you will need to incorporate your company, within the State of Bahrain, following Bahrain Commercial Companies Law.

As per the law, your company needs to take any one of the following forms: 1. General Partnership Company 2. Limited Partnership Company 3. Association in Participation 4. Joint Stock Company 5. With Limited Liability (WLL) 6. Single Person Company (SPC) 7. Holding Company

Audit requirements for Companies in Bahrain The Bahrain Commercial Companies Law clearly states that each company must “prepare the company’s balance sheet, profit and loss account and a report on the company’s activities and financial position.” These reports should be prepared before the last three months of each financial year. In case you are struggling much to meet the deadline for the reports, you can work with an audit company in Bahrain to make sure the process goes smoothly.

In addition to the requirement stated in the Bahrain Commercial Companies Law, all financial companies quoted on the Bahrain Bourse (B.H.B.), also need to publish quarterly financial statements. All these quarterly statements need to be reviewed by the external auditors, preferably experts with an audit license in Bahrain.

Types of Companies Required to Submit Audited Financials All commercial companies that do business in Bahrain are required to submit their audited annual reports to the reputed Ministry of Industry, Commerce and Tourism for review and analysis. Here’s a look at the different companies that need to submit audited annual reports and the deadline for submission: Bahrain Shareholding Company (B.S.C.) and B.S.C. (c) ● Deadline: Within six months of the company’s financial year-end. ● Signatory: Chairman and another board member Company With Limited Liability (W.L.L.) ● Deadline: Within six months of the company’s financial year-end. ● Signatory: Chairman and another board member Single Person Company (S.P.C.) ● Deadline: Within six months of the company’s financial year-end. ● Signatory: One director or more depending on the situation. Foreign company branch ● Deadline: Within six months of the company’s financial year-end. ● Signatory: One director or more depending on the situation.

Even if you find the audit requirements a little complicated, you can collaborate with financial experts to get the job done. Whether you are a joint-stock company, a limited liability, or a single person company that does business in the state, you can always reach out to audit firms in Bahrain to perform an annual audit that reflects your company’s true financial position.

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What are the requirements for the audits in Bahrain?

A report published in 2011 by the Index of Economic Freedom found that Bahrain had the freest economy in the Middle East. Additionally, it was recognized by the World Bank as a high-income economy. Given these incredible stats, it is easy to see why companies are flocking to Bahrain to set up shop. However, since all companies must comply with the audit requirements and legislation as laid down by the law and executed by the audit firms in Bahrain, you need to familiarize yourself with these requirements if you want your business to succeed.

Since the intricacies of financial law and audits can be a little overwhelming, you should work closely with audit and accounting firms in Bahrain to ensure tax and audit compliance. You can go through this article, in order to get a general overview of the requirements for the audits in Bahrain.

What are the types of Companies in Bahrain?

Before you get to the specific audit requirements, you first need to identify that in which category your company comes under. If you want to do business in Bahrain, you will need to incorporate your company, within the State of Bahrain, following Bahrain Commercial Companies Law.

As per the law, your company needs to take any one of the following forms: 

1. General Partnership Company

2. Limited Partnership Company

3. Association in Participation

4. Joint Stock Company

5. With Limited Liability (WLL)

6. Single Person Company (SPC)

7. Holding Company

Audit requirements for Companies in Bahrain

The Bahrain Commercial Companies Law clearly states that each company must “prepare the company’s balance sheet, profit and loss account and a report on the company’s activities and financial position.”

These reports should be prepared before the last three months of each financial year. In case you are struggling much to meet the deadline for the reports, you can work with an audit company in Bahrain to make sure the process goes smoothly.

In addition to the requirement stated in the Bahrain Commercial Companies Law, all financial companies quoted on the Bahrain Bourse (B.H.B.), also need to publish quarterly financial statements. All these quarterly statements need to be reviewed by the external auditors, preferably experts with an audit license in Bahrain. 

Types of Companies Required to Submit Audited Financials

All commercial companies that do business in Bahrain are required to submit their audited annual reports to the reputed Ministry of Industry, Commerce and Tourism for review and analysis.

Here’s a look at the different companies that need to submit audited annual reports and the deadline for submission:

Bahrain Shareholding Company (B.S.C.) and B.S.C. (c)

●        Deadline: Within six months of the company’s financial year-end.

●        Signatory: Chairman and another board member

Company With Limited Liability (W.L.L.)

●        Deadline: Within six months of the company’s financial year-end.

●        Signatory: Chairman and another board member

Single Person Company (S.P.C.)

●        Deadline: Within six months of the company’s financial year-end.

●        Signatory: One director or more depending on the situation.

Foreign company branch

●        Deadline: Within six months of the company’s financial year-end.

●        Signatory: One director or more depending on the situation.

Even if you find the audit requirements a little complicated, you can collaborate with financial experts to get the job done. Whether you are a joint-stock company, a limited liability, or a single person company that does business in the state, you can always reach out to Audit firms in Bahrain to perform an annual audit that reflects your company’s true financial position.