Uncover Hidden Errors, File Voluntary Disclosures, and Stay Ahead of FTA Audits with Proactive Pre-audit Checks.

1. Frequent errors in VAT reporting
2. Common triggers for FTA audits
3. Advantages of voluntary disclosure filing
4. Why pre-audit checks are essential
5. Identify gaps before FTA audits begin
6. Build a future-ready VAT process

In the rapidly evolving tax landscape of the UAE, Value Added Tax (VAT) compliance has moved beyond being a basic filing exercise—it is now a strategic and operational necessity. While most businesses believe that filing returns on time and making the appropriate tax payments is enough, the accuracy, documentation, and internal consistency of those returns often get overlooked until a Federal Tax Authority audit brings them into question.

As the FTA adopts more sophisticated audit and data reconciliation techniques—using cross-verification between customs data, supplier filings, VAT returns, and financial statements—the risk of legacy errors surfacing has significantly increased. In this context, conducting a VAT Pre-Audit Check is no longer optional—it’s a critical risk-mitigation and compliance strategy for any responsible business.

What Is a VAT Pre-Audit Check?

A VAT pre-audit check is a structured internal review of your tax position, documentation, and processes to assess whether you are truly in line with the UAE VAT Law and Executive Regulations. This process typically includes reconciliation of VAT returns with general ledgers, supplier and customer ledgers, customs declarations, and bank payments. It also includes validation of input tax claims and output tax treatment—especially for mixed-use supplies, exempt transactions, and zero-rated exports.

In many cases, errors are not intentional—but arise from system limitations, human oversight, poor classification, or untracked regulatory changes. A pre-audit check helps you detect these issues early, giving you time to file a Voluntary Disclosure before the FTA identifies the errors itself. Once the FTA initiates an audit or compliance review, your window to disclose voluntarily—without attracting major penalties—closes.

Why Voluntary Disclosure Is the Smarter Option

The UAE VAT system offers businesses an opportunity to come forward and correct mistakes before being penalized. This process, known as Voluntary Disclosure, enables businesses to amend prior VAT returns and resolve tax inaccuracies in a transparent manner. It is designed to encourage proactive compliance and reward honesty with lower penalties and simplified treatment.

There are several benefits of disclosing your VAT non-compliances voluntarily. First and foremost, you significantly reduce the financial impact. While penalties for errors discovered by the FTA during an audit can reach up to 200% of the tax underpaid, voluntarily disclosed errors generally attract a much lower penalty percentage—often just 5% to 30% depending on timing.

Secondly, voluntary disclosure can prevent criminal liability in cases where the tax authority might otherwise interpret the error as intentional fraud or evasion. By disclosing on your own initiative, you signal your willingness to cooperate and correct mistakes—making prosecution highly unlikely.

Third, it helps you protect your brand and reputation. Publicly known disputes with tax authorities or published penalties can erode the confidence of stakeholders, customers, partners, and banks. Voluntary compliance is discreet and contained, giving you the chance to manage your narrative.

Finally, disclosing voluntarily gives you a chance to build a stronger compliance framework going forward. It helps identify weaknesses in your current systems and allows you to reset your tax governance structure in line with the FTA’s expectations—before they come knocking.

Why You Should Act Now—Not Later

The FTA has been increasingly proactive in auditing businesses—especially those filing large refunds, dealing with zero-rated exports, or operating in sectors like real estate, construction, and logistics. Any significant shift in tax position, change in entity structure, or first-time refund claim can automatically flag the business for audit or query. Similarly, inconsistencies between your suppliers’ and your own VAT filings can also prompt system-generated inquiries.

Businesses that have recently changed consultants or implemented new accounting systems are particularly vulnerable. Transitional errors in VAT treatment, carryforward adjustments, or incorrect system configurations are common—and often go unnoticed for months.

Waiting until you receive an FTA audit notice is not a strategy. At that stage, your ability to file a voluntary disclosure is restricted, and you risk facing maximum penalties, reputational damage, and even temporary business disruption. A proactive pre-audit check gives you control over both the timing and the outcome.

How Stratify Consulting Group Can Support You

At Stratify Consulting Group, we’ve helped dozens of businesses across various industries identify and resolve VAT compliance gaps—well before they become regulatory issues. As an FTA-Approved Tax Agency, our approach is audit-ready, practical, and tailored to the complexities of your business.

We begin with a VAT Pre-Audit Health Check, where we review your VAT returns, reconciliations, invoices, contracts, and ERP configuration. This allows us to identify incorrect tax treatments, potential disclosure needs, and documentation gaps that could lead to audit triggers.

Where errors are found, we assist in preparing and filing the Voluntary Disclosure form with all necessary explanations and evidence. Our team ensures compliance with Article 10 of the Tax Procedures Law and helps minimize penalties through careful positioning and early action.

In addition, we work with your finance, tax, and operations teams to build a culture of compliance—from training sessions and SOPs to system controls and tax policy updates.

Take a Proactive Approach to VAT Compliance

You don’t need to be under audit to act. In fact, the most successful and secure businesses are those that prevent issues before they arise.

If your business:

• Is unsure about past VAT submissions

• Has claimed VAT on capital-intensive projects or employee-related expenses

• Is planning to file or has recently filed for a refund

• Has recently migrated to new systems or changed consultants Now is the time to schedule a VAT Pre-Audit Check. Don’t let avoidable mistakes escalate into serious penalties. Let our experts help you take control of your compliance journey—with clarity, confidence, and credibility.

Don’t wait for the FTA to find the mistake. Discover it yourself—correct it confidently—and move forward stronger.Get in touch for a free VAT health check consultation Email: info@stratify.ae