Under UAE VAT Law, it is specified that all tax registered individuals and businesses in the UAE should maintain their records in a way that enables the FTA to validate the data submitted for tax returns. It is required to maintain the records for a minimum of 5 years after the tax period, and records relating to real estate should be retained for at least 15 years from the end of the tax period to which they relate.
What records must be kept?
- Records of all supplies and Imports of Goods and Services.
- All Tax Invoices and alternative documents related to receiving Goods or Services.
- All Tax Credit Notes and alternative documents received.
- All Tax Invoices and alternative documents issued.
- All Tax Credit Notes and alternative documents issued.
- Records of Goods and Services that have been disposed of or used for matters not related to Business, showing Taxes paid for the same.
- Records of Goods and Services purchased and for which the Input Tax was not deducted.
- Records of exported Goods and Services.
- Records of adjustments or corrections made to accounts or Tax Invoices.
Even though businesses in UAE have done record-keeping and maintained accounts and records for their internal reference in the past, VAT Law requires accounts and records to be mandatorily maintained.
The failure of the person conducting Business to keep the required records and other information specified in the law would attract penalty for the taxable person.