News November 29, 2017
VAT (Value Added Tax) is actually a consumption tax that is imposed on goods and services at every stage of the customer cycle. There are a lot of benefits but businesses and organizations find it quite challenging for their business growth. It automatically increases the cost production for any product form its complete manufacturing procedure to the final delivery. VAT is going to support businesses in avoiding their financial difficulties. If an organization wanted to be VAT ready, they should be fully prepared and plan with an effective Point of Sales Software.
To be a VAT ready organization, there are different points that need to be considered in order to avoid any concern.
The procedure of VAT is competitively direct. If someone makes a purchase form a VAT registered company they will pay this tax. In the same way, if a business or an organization is buying products from a supplier they need to pay VAT tax accordingly. It simple words Value Added Tax normally endured by the customer and there is no recovery tool available. NextTotal enable VAT implementation as well as tracking in a smooth flow.
Taxable person/business should register to the VAT, a dedicated account number will be issued to them accordingly.
There are three times of registration being offered within Saudi Arabia.
If an organization is making a taxable supply of products more than SAR 375,000 annually. They need to get register for VAT until 20th December 2017. If their annual supply doesn’t exceed SAR 1,000,000 they are exempted from the mandatory registration until 20th December 2018.
Businesses make an annual taxable supply in excess of SAR 187,500 are qualified for voluntary registration. This type of registration is beneficent for the organizations in maintaining their business relationship and input tax deduction.
The ones who are non-resident or haven’t permanent business within Saudi Arabia are required to register if they responsible to pay VAT there.
It requires two type of registrations that are personal and tax information.
The following information is essentially required for this section:
The information related to tax is further divided according to the taxpayer’s type.
Individual Taxpayer needs to share the followings:
A company taxpayer will provide:
Review your challenges and understand them to know whether you’re VAT ready or not. Here, you need to have a well-designed and well-structured ERP that connects to all of your system including direct or indirect tax area with an easy access. To have more information Read.