Although the percentage of VAT charges implemented on the state is 5% only, yet the United Arab Emirates have laid down conditions based on which many foreign nationals can be eligible to claim for a refund of the VATs paid by them to the UAE Government.

Submission for filing in applications to request the Government for a refund is open since March 1, 2020, with the last date to file in an application is expected in October. Note that the refund amount you are claiming must be at least AED 2000 otherwise your application might get rejected. This is a condition led down by the Federal Authority of UAE because of which no considerations and modifications in the measures can be executed.

Eligibility Conditions for requesting a VAT refund

You can register an application for requesting a VAT refund from the UAE Government on the following conditions stated below:

  • You should not be a resident of the UAE.
  • You should not hold a place of any establishment in UAE.
  • You should not have a fixed establishment in any of the other GCC implementing states.
  • You should be a non-taxable person in UAE.
  • You should not carry any legal or illegal business or trades in the UAE.
  • You should carry business in your native land or your place of residence.
  • Or, you can also be registered as an establishment in the jurisdiction you belong to.

Only, when you meet the above-listed criteria listed by the Government of UAE, you will be able to get a refund on the value-added taxes paid by you to the Government for any previously carried trade or business scheme within in the precincts of the state.

Grounds on which a VAT refund claim is rejected

After having discussed the eligibility criteria for qualifying as a foreign business owner to get a refund from the federal government of UAE, let us now share a glimpse into the conditions on which the Federal Authority of the UAE Government rejects the claims and applications of foreign businesses for a VAT refund. The below-listed pointers indicate why VAT refunds are rejected.

  • If foreign business owners supply goods and services to the UAE market.
  • If the input taxes that are incurred on various goods and services are not recovered by a taxable person under the norms laid down by the UAE VAT legislation.
  • If the foreign business belongs to a country that does not offer VAT refund to UAE entities in similar situations.
  • If the foreign business carries out non-resident tour operations.

However, as per the GCC norms, every gulf country is bound to help each other at times of need and share its resources among each other if demand arises. Therefore, keeping in mind the treaty signed between the GCC states, VAT refunds restrictions that are imposed on the grounds of the lack in reciprocal treatments from other countries do not apply to business residents of any other GCC state that do not qualify as an implementing state.

Having problems in VAT Registration or filing returns? Here is your ultimate guide that could help you through the entire procedure for registration as well as for filing returns. All you have to do is contact us and we will appoint well-trained professionals who can easily attend your remarks and count on it at the earliest. Besides, GCC fillings are also associated with services like accounting and bookkeeping in UAE, auditing and tax consulting in UAE as well. Therefore, GCC filling is the one-stop destination for all your business-related queries. It also provides with proper assistance and guidance to heighten your business and establish a well-renowned name within the precincts of the state.

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