Media release on the focus session which was held on the mandatory compliance processes under the theme “beyond the introduction of VAT”.
More than 70 senior officials from the local business community attended an informative session on implications of the 2018 forthcoming Value-added Tax (VAT) implementation in Bahrain. A focus session was held on the mandatory compliance processes under the theme “beyond the introduction of VAT”. The half-day seminar was organized by KPMG in Bahrain, in cooperation with the Bahrain Capital Club and aimed at helping businesses to further prepare for the new tax system and ensure efficient VAT management in the immediate and longer-term future.
Philippe Norré, Head of Indirect Taxes at KPMG in Bahrain was the keynote speaker, discussing in a practical way the options available for VAT compliance and reporting and showcasing KPMG’s cutting-edge technology solutions to administer VAT that can be used and adapted for all businesses locally in Bahrain and across the GCC .
In his presentation, Norré explained that the complexity of managing VAT throughout the entire supply chain emphasis a need to have automated and technology-enabled processes in place to ensure a tailored VAT control framework with correct and timely compliance with the VAT reporting requirements. “Traditional methods of compliance, including the use of spreadsheets and manual processes, require tax professionals to spend tremendous amount of time in compilation and cross-checking documents. This carries a high risk of inaccurate reporting and not meeting the tax reporting obligations in time in its turn can lead to business disruption and severe penalties. However, a tailored level of technology-enabled automation would maintain operations excellence by optimizing resources, reduce risk of errors and facilitate VAT reporting in a timely manner.” he commented.
Upon VAT implementation in Bahrain by mid-2018 (as currently expected), businesses within annual supplies threshold of USD 100,000 (BD 37,700) will need to record, assess and report VAT obligations as well as VAT refund entitlements and submit them to the competent authority (to be set up) within specific timeframes. Detailed information about reporting formalities and timelines will be available in the local VAT law, when published in the upcoming months.
Norré also elaborated on the use of information technology to convert potential risks to profitable opportunities. “The growing competition and the increasing complexity of market regulations expected with the introduction of VAT put more emphasis on informed decision-making at all levels to make the best decision at the right time. Tax intelligence solutions, including KPMG’s “TIS”, exist and are designed to provide real-time insight on revenue streams by business units, showcasing opportunities to recover tax, improve cash flow and streamline financial processes.” He added.
Towards the end of his presentation, Norré noted that since the volume and type of business transactions differ from one organization to another, there is no one solution that fits all. He encouraged businesses to utilize the current VAT pre-implementation phase to analyze their business landscape and strategy with regard to critical tax issues and determine the best systems and solutions that would streamline their transactions-tax compliance processes.
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