Refund for Business Visitors

Recently Refund for Business visitors guide was released wherein the FTA has explained how to successfully fill the detailed VAT Refund form

Only eligible ‘Foreign Business’ can claim such refund. The conditions for eligibility are: 

• Foreign Business have no place of establishment or fixed establishment in the UAE or an Implementing State;
• Foreign Business are not a Taxable Person in the UAE;
• Foreign Business are not carrying on Business in the UAE;
• Foreign Business are carrying on a Business and are registered as an establishment with a competent authority in the jurisdiction in which they are established.

One should also be aware that the VAT cannot be claimed under following circumstances:

• Foreign Businesses supplies goods and/ or services to customers in the UAE who are not required to account for VAT under the reverse charge mechanism
• As per UAE VAT Law, the input tax incurred on procurement of goods or services is non-recoverable as per the UAE VAT Laws e.g. entertainment and motor vehicles available for personal use
• Foreign Business is from a country that does not have similar provisions to provide for VAT refund to UAE entities
• Foreign Business is a non-resident tour operator

There is a list of countries with reciprocal arrangements hasbeen provided by the UAE Ministry of Finance who’s companies can apply for such VAT Refund.

In case any country is not enlisted, the respective foreign business should approach the Ministry of Finance of one’s country which would have to contact the UAE Ministry of Finance for inclusion in the approved list.

To reduce our administrative refund claim, it is required that:

• The period of each Refund claim shall be 12 calendar months (except in the case of applicants resident in GCC states which are not Implementing States) . Thus any refund applications pertaining to 1 st January 2018 – 31st December 2018 can be made from 2nd April 2019

• The minimum amount of VAT for which a claim may be submitted under this scheme shall be AED 2,000

The detailed method of filing the application form is available on https://tax.gov.ae/-/media/Files/EN/PDF/Guides/Refund-Guide-for-Business-Visitors---EN---16-10-2019.pdf

 

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