TALKING BUSINESS
VAT INTRODUCTION IS THE
CASE FOR E-INVOICING &
E-ARCHIVING SOLUTIONS
V
AT WILL TRANSFORM THE WAY TRADING
COMPANIES ACROSS THE GCC CONCLUDE BUSINESS
TRANSACTIONS – BE IT A SME/ SMB OR A LARGE
ENTERPRISE. IT IS THE CASE FOR IT SOLUTIONS, SUCH AS
E-INVOICE SUITE AND E-ARCHIVE SUITE, TO ENSURE SMOOTH
TRANSITION TO THE NEW TAX LANDSCAPE AND GUARANTEE
ON-GOING VAT COMPLIANCE.
Practically speaking,
how can e-invoicing
solutions assist GCC
businesses in the VAT
implementation?
One of the primary implications
of VAT implementation for all
businesses charging VAT on
supplies is the necessity to issue
VAT invoices as an evidence of
a sales transaction. Of course,
businesses can issue VAT invoices
in paper, however, paper-based
invoicing poses a number of
challenges both to a selling
and a buying party, including:
accounting codification, invoice
validation, typing errors, disputes
between trading partners
arising from overpayment,
underpayment, incorrect data.
Switching from paper invoices
in favour of electronic invoices
can resolve these issues by
introducing full automation and
transparency in terms of invoice
circulation between sellers/buyers
and tax authorities.
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INTELLIGENTCIO
Charging VAT on
supplies e-invoice suite which automatically
calculates the correct amount.
In the VAT landscape, GCC
businesses will be obliged to charge
VAT on supplies at a correct rate
– either a standard rate (5%) or a
zero rate. This extra administrative
burden will be particularly time-
consuming and error-prone to
trading companies with a big
volume of invoices on a regular
basis. However, e-invoicing solution
can facilitate this process by
automatically matching a correct
VAT rate to a given product. Calculating the total
net amount of VAT to
pay / to refund
Calculating VAT
deductible
Following the introduction of
VAT, companies across the GCC
will be required to calculate VAT
deductible on purchases. Electronic
invoicing can also come in handy
in this area. Instead of calculating
VAT deductible manually,
companies can make use of the
VAT mechanism embedded in the
Another requirement of VAT
relies on calculating the total net
amount of VAT to pay or to refund.
Of course, businesses can calculate
the amounts of VAT manually,
without any enterprise software,
but electronic invoicing can be an
answer to this challenge as well.
Simply because e-invoice suite uses
accurate validation mechanisms,
you can be sure that the net
amount is correct and a document
can be quickly processed further.
Cash Flow
The implementation of VAT
means that improved cash flow
will become even more important
than before. Settling bills and
collecting payments fast is
directly linked to the working
capital of a company. With an
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