Everything UAE Taxpayers Must Know about Magnati, the Replacement for E-Dirham
Payers in the UAE need to be aware of the new mode of payment that has been approved by the Federal Tax Authority (FTA). The Federal Tax Authority of the United Arab Emirates (FTA) has officially phased out the use of e-dirham and replaced it with the smart payment system Magnati. To quickly adjust to the new tax payment structure, you might seek advice from tax agents in Dubai. Key information regarding Magnati, the new currency that will replace e-dirham, is outlined here. To learn more, keep reading:-
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What Does the FTA Say about the Discontinuation of E-Dirham?
The FTA has announced that beginning on October 30, 2022, it will no longer accept e-dirham payments. The e-dirham, which was introduced in 2001, is the official currency of the United Arab Emirates and is accepted across the board. This follows the UAE government's plan to phase out the use of e-dirham card across all government agencies. To learn more about the modifications to the UAE's tax payment system, you should speak with a tax agent there.
What Is Magnati the Replacement for E-Dirham in the UAE?
The First Abu Dhabi Bank created the Magnati payment system to be a modern and easy way to send money (FAB). Magnati is a wholly owned subsidiary of FAB that processes payments for a wide variety of businesses and organisations. This includes sectors as diverse as government services, healthcare, education, real estate, hospitality, food and beverage, retail, and parking solutions. With Magnati's unified API, integration is simplified, costs are reduced, and individual preferences for how they'd like to be charged are accommodated.
What Types of Tax Payment with Magnati?
The Ministry of Finance now accepts Magnati payments, giving taxpayers a more convenient and advanced method of settling their tax obligations. Magnati facilitates the following tax payments:-
- Value Added Tax (VAT)
- Excise Tax
- UAE Corporate Tax (once it takes effect on June 1st, 2023)
What are the features of Magnati?
It is hoped that Magnati will streamline the processes involved in remitting tax payments to UAE government agencies including the FTA. U.A.E. tax professionals, however, recommend using Magnati's features to ensure you're not missing anything before filing your taxes. Some of Magnati's best qualities include:-
- Provides specialised, user-tailored services for a variety of industries.
- Provides online and at-the-register (POS) card and electronic payment acceptance services to UAE government entities.
- Smart routing, DCC, and multi-currency transaction processing supported.
- Wallets like Apple Pay, Samsung Pay, Google Pay, and FAB's Payit are all accepted.
- Allows for Buy Now Pay Later (BNPL) and Easy Payment Plan (EPP) choices, as well as tokenization, batch processing, and recurring payments
- Offers complete oversight over the process
- Comprehensive safeguards for sensitive information
What Should You Do with Your E-Dirham Balance?
According to the FTA's announcement, the Magnati will be used in place of the e-dirham. Some consumers, however, may still have a balance on their e-dirham cards. The FTA instructs tax agents in Dubai to have such customers contact the banks that provided their e-dirham cards in order to redeem the funds on their cards.
What Does the FTA Say about Payments Made Using GIBAN?
The FTA claims that the e-Services portal on the FTA website provides customers with a variety of secure and convenient payment options. One of these options is the Newly Established Foreign Bank Account Number (GIBAN). Each taxpayer is assigned a unique Global Interbank BIC/NAIC Number by the FTA so that payments can be made quickly and easily via electronic fund transfers straight from their bank accounts to the Authority (GIBAN).
The GIBAN system is used by a variety of banks in the UAE and internationally to transfer customers' deposits and withdrawals. The system can be used to remit payments for Value-Added Tax, Excise Tax, and any other tax. Before making any tax payments in Dubai, it is recommended that local experts be consulted. In addition to the established payment methods described in the FTA below, taxpayers can now pay their tax bills using GIBAN and the new platform.
Conclusion:- You will understand everything regarding E-Dirham and Magnati for your business. If you have any suggestions or doubts then contact Risians Accounting Firm for further details.