Date of Supply Rules for UAE VAT Transactions

Date of Supply is the date on which obligation to pay tax arises. The Decree law specifies different time of taxability for supply of goods and services. As per Article 25 of the UAE Vat Decree Law, the date of Supply shall be earliest of:

A. For Goods

• The date on which Goods were transferred, if such transfer was under the supervision of the supplier.

For Example: Company A buys an asset from Company B. Company B delivers the asset to Company A on 8th February 2019 but issues tax invoice on 1st March 2019. In this case, date of supply will be 8th February and vat will be due on the same date.

• The date on which the Recipient of Goods took possession of the Goods, if the transfer was not supervised by the supplier. This simply means that all risks and rewards should have passed from the supplier to the recipient.

For Example: Company A orders goods from Company B. Company B makes the goods available for collection by Company A on 8th Feb 2019 and raises an invoice for the same on 1st March 2019. In this case, date of supply will be 8th February and vat will be due on the same date.

• Where goods are supplied with assembly and installation, the date on which the assembly or installation of the Goods was completed.

For Example: Company A buys a machinery from Company B. Company B delivers the machinery to Company A on 8th February 2019 but assembly and installation is done by Company B on 1st March 2019. In this case, date of supply will be 1st March and vat will be due on the same date.

• The date on which the Goods are imported under the Customs Legislation.

• The date on which the Recipient of Goods accepted the supply, or a date no later than twelve months after the date on which the Goods were transferred or placed under the Recipient of Goods’ disposal, if the supply was made on a returnable basis.

• The date of receipt of payment

• The date on which the Tax Invoice was issued

B. For Services

• The date on which the provision of Services was completed.

For Example: Company A provides book-keeping services to Company B. Company A starts the service on 1st May 2019 and finishes its work on 15th May 2019. In this case, date of supply will be 15th May and vat will be due on the same date.

• The date of receipt of payment

• The date on which the Tax Invoice was issued.

Exceptions to Date of supply Rule

A. Periodic payments or consecutive invoices

In case of continuous contracts which include periodic payments or consecutive invoices, the date of supply of Goods or Services shall be the earliest of any of the following dates, provided that it does not exceed one year from the date of the provision of such Goods and Services:

•The date of issuance of any Tax Invoice.

•The date payment is due as shown on the Tax Invoice.

•The date of receipt of payment.

B. Payments through Vending Machines

Where the payment is made through vending machines, date of supply shall be the date on which funds are collected from the machine.

C. Deemed supply of goods or services

Date of supply in case of deemed supply of goods or services shall be the date of their supply, disposal, change of usage or the date of deregistration, as the case may be.

D. Voucher

In the case of voucher, date of supply will be the date of issuance of voucher or supply thereafter.

Disclaimer : Content posted is for informational & knowledge sharing purposes only, and is not intended to be a substitute for professional advice related to tax, finance or accounting. Each article/view/comment posted by third party readers/subscribers of our website on topics of tax and accounting is their personal opinion and due professional care should be taken by you before you act after reading the contents of that article/post. No warranty whatsoever is made that any of the articles are accurate. and is not intended to provide, and should not be relied on for tax or accounting advice.