The impact of VAT on construction projects – and contractors – can be better understood through the adoption of specialist software, as Andrew Skudder, CEO of building technology giant Construction Computer Software (CCS), explains.
Towards the end of 2017, it was established that the proposed introduction of value-added tax (VAT) in the UAE would soon happen. You might remember a discernible uplift in cash flow at the time, as companies invoiced and billed to beat the 5% levy they expected to incur following the launch of VAT. That was, of course, a blip, but the forecasted benefit in VAT revenue for the UAE was expected to contribute significantly to the country’s GDP.
Little over a year later, VAT is still relatively new in the country, but is rapidly becoming an embedded part of everyday life in the UAE. However, there are still many areas of uncertainty, and the knowledge of process and procedures is in its infancy, but as the old saying goes, ignorance is no defense when it comes to law.
It is not unlikely that some business-owners, including those in the construction sector, may struggle to understand their responsibilities in terms of VAT collection or payment. Fortunately, there are tools that can help construction professionals in dealing with VAT and any other form of change or development in all types of taxation.
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