It became mandatory two months ago
Two experts: The tax return is a sufficient alternative to documents when companies request financing from banks
The tax return shows cash flows, income, turnover, and profits.
Banks operating in the country began relying on the tax return of companies registered in the Federal Tax Authority system as a mandatory document and a sufficient and fast alternative when requesting documents related to financial accounts and cash flows, as the tax number, as well as the tax return, has become a basic requirement when applying for all types of financing. In addition to business loans, including car financing for companies.
The tax agent, Muhammad Helmy, told «Emirates Today» that in terms of accounting and finance, there is sometimes a lack of financial documents required by banks to approve financing, so the tax number is required for viewing, along with a copy of the tax return submitted to the Federal Authority. for taxes, as the latter shows all cash flows, in addition to income, business volume, profits, and more.
Helmy confirmed that the tax return is an official and reliable government document, and it contains clarity and transparency, which greatly helps banks when deciding whether to approve or reject financing.
He added that the form and mechanism for preparing the tax return is comprehensive enough, which contributes to giving an objective view of the situation of the company that wishes to take financing, and therefore through which it is possible to study the case and assess the degree of risk accordingly.
In terms of banking, banker Tamer Abu Bakr stated that the tax number and tax return have become official documents required for approval of corporate financing, indicating that they became mandatory about two months ago, as they give a clearer picture of the current situation of the company requesting financing.
He said that all banks are now essentially requesting a tax return, and are satisfied with it if some other documents are not available.
Abu Bakr explained that if the customer brings, for example, an account statement showing that his income is five million dirhams annually, the tax return is the guaranteed way to confirm this, which gives the credit departments in banks the freedom to make a financing decision.
He added that the tax number is linked to the commercial license, which allows banks to verify the validity of the license according to it, pointing out that this greatly facilitates the work of bank employees.
Money transfer system
Money transfer system
In February 2018, the Central Bank signed a memorandum of understanding with the Federal Tax Authority, regarding the electronic link between the two sides, allowing those registered in the tax system with the authority to pay the taxes due on them, through the Emirates Fund Transfer System, which is characterized by high speed in transferring funds through bank accounts.
The memorandum of understanding established a mechanism that allows taxpayers registered with the Authority who are bank dealers to pay their tax obligations electronically, through their bank accounts using the money transfer option.
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