As per the Cabinet Decision No. 1 of 2019 on the ‘Refund of Value Added Tax Paid on Goods and Services Connected with Expo 2020 Dubai’, Official Participants of the Expo 2020 are able to claim a refund of VAT incurred by them on the import or supply of certain Goods and Services.
The document provides guidance for Official Participants of Expo 2020 in respect to the following:
• The conditions which have to be met to be entitled to claim the VAT refund;
• The process to be followed to claim VAT; and
• Information required to complete the relevant forms.
Official participants will be incurring VAT as usual as per the UAE VAT law.
In certain situations, Official Participants are eligible to recover VAT on certain Goods and Services which were imported or acquired.
The application to recover VAT incurred can be made by one of the following methods:
• Where the Official Participant is not registered for UAE VAT, the refund applications can be made through the Bureau by submitting a special refund application to the Bureau.
• Where the Official Participant is registered for VAT, it may reclaim VAT via its UAE VAT return.
It should be noted that the Official Participant must register for VAT if the value of their taxable supplies or imports (for commercial or non-official purposes) in the UAE exceeds, or is anticipated to exceed, the mandatory registration threshold of AED 375,000.
A person will only be able to recover VAT incurred in UAE where the Goods and Services are used or intended to be used for making taxable supplies.
In case incurred expenses do not relate to any taxable supplies made by the person, VAT is not recoverable.
However, VAT incurred on the import and acquisition of the following four categories of Goods and Services without the need to use them for making taxable supplies:
A. VAT incurred by the Official Participant on Goods and Services in direct connection with the construction, installation, alteration, decoration and dismantlement of their exhibition space;
B. VAT incurred by the Official Participant on Goods and Services in direct connection with the operation of their exhibition space and any presentation within the Expo 2020 site;
C. VAT incurred by the Official Participant on Goods and Services relating to the actual operation of the office of the Official Participant, provided that the value of each Good or Service for which a claim is made is not less than AED 200; and
D. VAT incurred on import of Goods for personal use of the Official Participant’s Section Commissioner-General, Section Staff and the Beneficiaries.
It should be noted that in order to be eligible to reclaim VAT on expenses under categories A and/or B, the Official Participant must be in possession of a Certificate of Refund Entitlement issued by the Bureau.
In respect of imports made by Official Participants, it should be noted that they may use the special TRN (Tax Registration Number) allocated to the Bureau, in coordination with the Bureau, where the goods fall under Categories A and B in above section, and they hold a Certificate of Refund Entitlement.
Where the special TRN is used, no import VAT will be imposed in respect of the goods, and such goods should not be included in any refund application.
Certificate of Refund Entitlement for claiming refund under categories A and B above:
An Official Participant (both registered and not registered for VAT) must apply for a Certificate of Refund Entitlement before attempting to reclaim VAT on Goods and Services under categories A and B described above.
A certificate reference number will be provided to the Official Participant and must be referenced in all special refund applications concerning Goods and Services that fall under categories A and B.
In order to be eligible to apply for the Certificate:
• The applicant must be an Official Participant of the Expo 2020 in Dubai, holding a valid Expo 2020 trade licence number.
• Not more than 20% of the exhibition space or presentation is, has been, or is intended to be used for non-official or commercial purposes.
If the Certificate of Refund Entitlement is not granted to the Official Participant (for example, if more than 20% of exhibition space will be used for non-official or commercial purposes), the Official Participant will not be able to reclaim full amount of VAT in respect of Goods and Services under Categories A and B above under the special rules. Instead, the Official Participant may need to consider if any VAT related to such Goods and Services may be recoverable under the general VAT rules applicable to VAT registered person.
To apply for Certificate of entitlement an application should be made directly to the Bureau by completing an application form and submitting it to the Bureau by email.
Details are as follows:
To apply for the Certificate, a Request Form must be provided by the Official Participant to the Bureau. This should include the following information:
• Area of the pavilion (in square meters) used by the Official Participant.
• Location of the pavilion.
• Details and percentage of commercial use of space (if any).
• Detailed description of the purpose of the pavilion space.
• Declaration which will include a confirmation on the following:
• That a notification to the Bureau will be made should any changes occur that would affect the eligibility to a Certificate of Refund Entitlement.
• The understanding that the Certificate of Refund Entitlement only gives right to claim VAT on Goods and Services under categories A and B mentioned above.
The following supporting documents must be provided with the application for a Certificate of Refund Entitlement:
• Expo 2020 trade licence
• Scan of passport and Emirates ID of the Section Commissioner-General of the Official Participant.
Processing of Certificate of the Refund Application:
It will take the Bureau up to 20 business days to review the application. If accepted, the Bureau will issue the Certificate of Refund Entitlement within 10 business days. The certificate will be provided in letter format and will be signed by the Bureau, scanned and sent by email. The Certificate will have a unique reference number. Unless withdrawn or cancelled, the Certificate of Refund Entitlement will be valid for all qualifying expenses incurred for the purposes of Expo 2020.The Bureau will not charge a fee for such a Certificate.
The Official Participant is required to inform the Bureau if it stops being eligible to a Certificate of Refund Entitlement.
Apply for Refund:
Official Participants registered for VAT:
Where the Official Participant is registered for VAT in the UAE, it will be required to file regular VAT returns. Such VAT returns will contain information regarding supplies and imports made by the Official Participant for which VAT is payable, as well as of any expenses in respect of which the Official Participant seeks to recover VAT incurred.
Official Participants not registered for VAT:
Where the Official Participant is not registered for VAT, it can apply for a VAT refund in respect of Goods and Services mentioned in categories A to D of this guide by using a special refund application process. The application shall be made to the Bureau and, if approved, the VAT will be refunded directly by the FTA. The refund application must contain the following information:
• Reference number of the Certificate of Refund Entitlement, if the application includes Goods and Services from categories A or B as mentioned above
• Reference number and date of the previous refund claim.
• Details of the supplies supported by original tax invoices / customs declarations.
• Description of the Goods and Services to confirm that they fall under the categories of eligible Goods and Services as mentioned above
• Declaration which will include a confirmation of the following:
a) Notification to the Bureau should any changes occur that would affect the eligibility of requesting a refund.
b) Confirmation that no other refund claim has been or will be made in respect of the Goods and Services disclosed in the application.
c) Declaration that any imported Goods included in the application will not be sold without prior approval from the Bureau and payment of VAT.
Supporting documents for claiming Refund:
The following supporting documents must be provided by Official Participants not registered for VAT:
• Copy of the Certificate of Refund Entitlement issued to the Official Participant.
• Copies of the tax invoices, including simplified tax invoices. Only invoices issued to the eligible persons are allowed to be used to claim the refund.
• Copies of customs declarations issued in respect of imported Goods.
• If the application includes Goods and Services from category D, the following is required: o
1) Copies of an employment ID that proves the employment of the personnel in respect of whom the VAT is being reclaimed.
2) Copies of documents that prove the relationship of the relevant beneficiaries.
• Bank account validation letter / certificate. This letter / certificate must be issued and stamped by the bank and include details about the account holder’s name (must be the same as the applicant’s name), SWIFT / BIC (as applicable), bank name and the IBAN.
Additionally, the Bureau may request to examine the Goods or Services in question (or nominate an authorised third party to do so).
Processing of Refund:
It will take the Bureau up to 20 business days to review the application. The applicant will be notified of the results and of the amount of VAT refund approved.
If accepted, the Official Participant will receive the refund of VAT directly from the FTA into the nominated bank account within 30 business days of approval of the application
Frequency of the refund application:
Official Participants registered for VAT can claim a refund on their regular VAT return.
Official Participants not registered for VAT may apply as follows:
• Within 15 days of the end of the calendar month in which the total VAT value to be claimed is AED 10,000 or more.
• Within 15 days of the end of the calendar quarter where the total VAT value to be claimed is less than AED 10,000.
The refund application frequency may change depending on the total VAT to be claimed.
If an Official Participant has omitted any qualifying expenses from a refund application, these expenses may be included in a subsequent application.
Payment of the Tax upon sale of imported goods:
Where a refund has been granted to the Official Participant in respect of any import of Goods, the Goods cannot be sold for Consideration or transferred free of charge without the prior consent of the Bureau, and without payment of the Tax.
In order to obtain approval, the following steps must be followed:
1. Submit Consent of Sale Request Form
• Before the sale of the Goods, the Official Participant must request an approval of the sale by submitting the “Consent of Sale Request Form” to the Bureau. The form shall be submitted electronically.
• The Official Participant is required to disclose the quantity and sales price of the relevant imported goods which are to be sold. Furthermore, the Official Participant must indicate in which refund claim it reclaimed the VAT in respect of import of the relevant Goods.
• It will take up to 10 business days for the Bureau to provide the approval of the sale. Each approval notification will contain the special approval reference number.
2. Payment of VAT
Once the Official Participant has received the approval on the sale notification from the Bureau, it may proceed with the sale of the Goods.
Following the completion of the sale, the Official Participant should account to the FTA for the amount equal to 1/21 of the sale price of the goods. The method of payment to the FTA will depend on whether or not the Official Participant is registered for VAT:
• If the Official Participant is not registered for VAT, it shall make the payment of the VAT amount to the Bureau and the Bureau will record this on the VAT return of the special TRN allocated for this purpose. The Bureau will keep records of the sale notifications granted by it.
• If the Official Participant is registered for VAT, it should include the amount of VAT into Box 1 of the VAT return relating to the month in which the Goods were sold.
Following the completion of the payment, the Official Participant shall provide a copy of the sales invoices to the Bureau.
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