Businesses shall be prepared for updates in the tax system in Qatar
25/02/21
Qatar is getting ready to implement a Value Added Tax (VAT) and the private sector has been urged to prepare for it accordingly. It is advised to be VAT ready at least six to nine months before the implementation.
Qatar signed the Gulf Cooperation Council (GCC) VAT framework in 2016 and has seen the establishment of the General Tax Authority (GTA) which has been working on the finalization of the regulations and the Information Technology (IT) systems.
In preparation for the implementation, the GTA has prepared a framework to inform the private sector about the extensive requirements related to the implementation of a VAT.
It is recommended to conduct VAT impact assessments and to consider the introduction of tax steering and working committees. Ideally, businesses should test systems for accuracy and sensibility. Due to the fact that the VAT is a transaction-based tax, it affects each and every transaction.
The VAT is an addition to the taxation of the locally sourced profits at the rate of 10%. Whereas, the costs and expenses of a business are deductible from the income and the losses can be rolled over for a period no longer than three years. The corporate tax applies to organizations with commercial activities in any profession, vocation or trade.
Organizations set up under the free zones as well as selected oil and gas corporations may fall under alternative VAT frameworks.
Please click on the link and reach out to learn more about the tax system in the State of Qatar and Business Start Up Qatar.
