Small and Medium Enterprises (“SMEs”) are the pillars of any economy, even more so in the case of UAE. Recognizing this importance, FTA launched the Muwafaq Package aimed to assist SME’s and ease their way into the new federal tax regime. Packed with innovative solutions, Muwafaq aims to assist and enhance tax compliance by SMEs by packing it with several services and facilities that are tailored to suit the specific needs of SMEs. Eligible SMEs, following notification of eligibility on the EMARATAX portal, can easily register and access the package’s incentives and features through the portal.
Privileges included:
Information privileges – SMEs can develop a self-complaint tax system, by taking advantage of the free tailored educational workshops, training programs, awareness campaigns and materials provided within the Package. These trainings and materials are offered in both Arabic and English. The materials cover a wide range of topics including directions on new user creation, registration, required documentation, stages for processing registration application.
Advisory Services – Taking the financial constraints of SMEs into consideration, Muwafaq, offers competitive prices for FTA registered Tax Agents and accounting software. Additionally, SMEs can also take advantage of the FTA assigned relationship manager to obtain personalized financial advice for banking solutions and other support to grow their businesses.
Tax compliance and documentation – The predominant goal of Muwafaq package is to streamline the tax compliance process, in a cost-effective manner. SMEs can also easily register and file their returns, and even organize their accounting and financial documentation. Some of the key features are elaborated below for our readers:
Invoicing – the Package software can be used to generate VAT-compliant invoices that meets the requirements set by FTA. This simplifies the process of invoicing for SMEs and ensures that that their invoices are tax compliant thereby avoiding risk of penalties and/or legal issues.
Invoicing – the Package software can be used to generate VAT-compliant invoices that meets the requirements set by FTA. This simplifies the process of invoicing for SMEs and ensures that that their invoices are tax compliant thereby avoiding risk of penalties and/or legal issues.
Tools – Registrants can simply enter the transaction details such as value of goods/services and the applicable tax rate into the tool, which will then automatically calculate the tax amount. Similarly, registrants can also make use of the Tax Return Generation Tool that has a simple and quick system to generate returns. These tools significantly reduce the risk of error in tax calculation and also helps SMEs to save time by reducing administrative burden.
Ending Thoughts
The Muwafaq Package is a much needed and effective government initiative that provides comprehensive financial assistance to SMEs. The simplified system not only assists SMEs in their transition to comply with the new tax regime, but provides additional support for digital transformation, entering new markets and thereby growing their businesses. Overall, with the Muwafaq Package, the UAE Government continues to set itself apart by continuing efforts to grow and develop a favorable business environment for SMEs.