Find the errors before the FTA does
VAT Health Check
A VAT health check independently reviews your treatment across recent returns — catching exempt-versus-zero-rated errors and missed reverse-charge entries before they've compounded across multiple filing periods into something considerably harder to unwind.
Most valuable finding: nothing wrong. Second most valuable: an error worth self-correcting
Key facts
| Scope | Review of recent VAT returns against underlying transactions and supporting documentation |
| Common findings | Exempt/zero-rated misclassification, missed reverse charge, non-recoverable input VAT claimed |
| Outcome | A clear report, with a voluntary disclosure recommendation where genuinely needed |
What this actually involves
A VAT health check works backward from your filed returns to the underlying transactions, checking that what was reported actually matches what should have been reported under the correct VAT treatment — a fundamentally different exercise from routine monthly processing, which checks that transactions are recorded, not necessarily that every classification decision made along the way was correct.
The value of a health check isn't primarily in finding something wrong — often, the finding is genuinely that your VAT treatment is sound, which is itself useful confirmation before a major transaction, an audit, or simply as periodic assurance. Where an issue is found, catching it through a proactive health check rather than an FTA review means a voluntary disclosure is still available as the lower-penalty correction route.
We recommend running a health check annually as standard practice, and additionally whenever your business undergoes a material change — a new revenue stream, entry into a new export market, a new supplier or customer structure — since each of these is a point where VAT treatment assumptions that worked previously can quietly stop applying correctly.
Is this actually relevant to you?
- You've never had your VAT treatment independently reviewed since initial registration
- You're preparing for a bank financing application, sale, or investment round and want assurance your VAT position is clean
- Your business has recently changed in a material way — new revenue stream, new export market, new supplier structure — since your VAT treatment was last reviewed
- You want periodic independent assurance rather than relying solely on your bookkeeper's routine processing
Our process, step by step
Transaction-level VAT review
Sample or full review of transactions against how VAT was actually treated in filed returns.
Findings report
Clear, prioritised list of any issues found, with recommended next steps for each.
Voluntary disclosure support
Where an error genuinely needs correcting, preparing the disclosure properly and promptly.
Scope of work
Issues found in a health check are fixed through a voluntary disclosure or corrected VAT returns, and the review is good preparation for an FTA audit.
What consistently surfaces on independent review
- Exempt supplies treated as zero-rated (or the reverse), quietly compounding a recovery error across every return since the initial misclassification.
- Reverse-charge entries missed entirely on imported services, understating the return even where the net cash effect would have been nil.
- Input VAT claimed on categories of expense (certain entertainment costs, for example) that aren't actually recoverable under current rules.
Related VAT services in the UAE
From first registration to deregistration — VAT handled end to end, with returns reconciled to your accounts.
Related guides from our team
Practical explanations of the rules behind this service, written by our chartered accountants.
Common questions
How often should we run a VAT health check?+
Annually at minimum, and definitely before any major transaction type change (new revenue stream, new export market, new supplier structure) or before a significant financing or sale transaction.
What if the health check finds a significant error?+
We'll walk you through the voluntary disclosure process — correcting proactively carries materially lower penalties than an FTA-discovered error found through their own review.
Does a health check cover every transaction or just a sample?+
Depends on scope and business size — for smaller businesses a full review is often practical; for larger, high-volume businesses a risk-based sample targeting higher-value or unusual transaction types is more typical.
Will a health check slow down our normal filing cycle?+
No — it's a separate, standalone review of past periods, run alongside rather than instead of your ongoing filing cycle.
Can a health check be done before a bank financing application?+
Yes — this is a common and sensible trigger, since a clean, independently reviewed VAT position supports the financial credibility banks assess as part of their process.
Never had your VAT treatment independently reviewed?
A health check now is cheaper than a voluntary disclosure later, which is cheaper again than an FTA finding.