India has evolved from the phase where indirect taxes meant complex tax formalities to Goods and Services Tax (“GST”) Law which can be understood by any layman. These complexities were escaped under the UAE Value Added Tax (“VAT”) law as the same was brought in a phased manner.
The basic step in any law is being compliant with payment of tax and filing the returns for the authorities to check whether they are receiving the correct taxes. Here, we are going to unlock the return which is filed under both the tax laws to understand the similarities in UAE VAT return and India GST return for correct disclosure and payment of tax.
In common parlance, VAT/GST means output tax i.e., tax payable on sales less input tax i.e., credit eligible to be claimed. The net amount is the tax which is either payable or recoverable from the registered dealer. Below is the tabular presentation to draw similarity and difference under the different return forms of the two taxes:
|
VAT 201 |
GSTR-3B |
| Each section is known as ‘Box’ i.e., Box-1,2 etc. | Each section is known as ‘Column’ i.e., Col. 1, 2 etc. |
| The basic details such as registration number (TRN), name, address and period are auto populated. | The basic details such as registration number (GSTIN), legal name along with month and period are auto populated |
| Box 1-8: Outward Supply
1. Box 1: Taxable Supply (to Abu Dhabi, Dubai, Sharjah & Ajman) 2. Box 2: Supplies under tourist refund scheme by retailers is auto populated 3. Box 3: Supplies liable to reverse charge mechanism 4. Box 4: Zero-rate supply 5. Box 5: Exempt supply 6. Box 6: Import i.e., is auto populated from custom portal 7. Box 7: Import adjustment, if there is any change from the auto populated data in box 6 8. Box 8: Total taxable value along with taxes is auto calculated |
Col. 3.1 & 3.2: Outward Supply
1. Under Col 3.1 below types of supplies are reported:
2. Under Col. 3.2 only disclosure of supply already reported in Col. 3.1 are shown such as:
|
| Box 9-11: Inward Supply
1. Box 9: VAT amount in relation to inward supply and standard rate adjustment 2. Box 10: VAT amount as per reverse charge mechanism 3. Box 11: Auto-calculates the amount of inward supply |
Col. 4 & 5: Inward Supply
1. Col 4: Disclosure in relation to imports, reverse charge mechanism, cross charge/ISD, other ITC. Along with reversal and ineligible ITC is reported. 2. Col 5: Disclosure in relation to inward supplies which are nil-rated and non-GST are reported. |
| Box 12-14: Computation of tax payable/refundable
1. Box 12: Net output details 2. Box 13: Net input details 3. Box 14: Net payable/refundable VAT Note: If sales are reported under profit margin scheme the same needs to be disclosed by ticking the check box. Post which the data is saved for final review. After, final submission the portal shifts to payment site else shows submitted. |
Col. 6.1-6.2: Computation of tax payable
1. Col 6.1: Under this column, the GST portal auto-calculates the tax payable after adjustment of ITC available along with interest and late fee, if any. 2. Col 6.2: TDS/TCS details are reported |
| Signed by authorized signatory. | Signed by authorized signatory. |
Both the returns serve the purpose of collecting taxes on value added in the supply chain. Although, they do differ in terms of their scope, complexity, and the specific context in which they are used. The return filing process is a compliance procedure defined by the law of the country to ensure smooth tax system and avoid any legal complication. The above tabular presentation is an attempt to showcase the two returns which are undertaken by the taxpayers to report their sales and purchases.
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