VAT Refund for Business Visitors

VAT Refund for Business Visitors : A foreign business may be entitled to enjoy VAT Refunds of tax paid in certain instances. Process of claiming back the VAT paid by Business Visitors that are eligible for a Refund in UAE

Who can claim a Refund?

Only foreign businesses who meet the following conditions are eligible to apply for a Refund:

  • They have no place of establishment((The place where a Business is legally established in a country pursuant to the decision of its establishment, or in which significant management decisions are taken and central management functions are conducted.)) or fixed establishment((Any fixed place of business, other than the Place of Establishment, in which the Person conducts his business regularly or permanently and where sufficient human and technology resources exist to enable the Person to supply or acquire Goods or Services, including the Person’s branches.)) in the UAE or an Implementing Stats((The GCC States which are implementing a VAT law pursuant to issued legislation and are fully abiding by all provisions of the GCC agreement.));
  • They are not a Taxable Person ((Any Person registered or obligated to register for Tax purposes under the VAT Law)) in the UAE;
  • They are not carrying on Business ((Any activity conducted regularly, on an ongoing basis and independently by any Person, in any location, such as industrial, commercial, agricultural, professional, service or excavation activities or anything related to the use of tangible or intangible property)) in the UAE;
  • They are carrying on a Business and are registered as an establishment with a competent authority in the jurisdiction in which they are established

A VAT Refund is not available under the scheme if:

  • The Foreign Business makes supplies in the UAE (unless the recipient is obliged to account for VAT under the reverse charge mechanism); 
  • The input tax incurred on the goods or services is non-recoverable by a Taxable Person according to the UAE VAT legislation e.g. entertainment and motor vehicles available for personal use; 
  • The Foreign Business is from a country that does not in similar circumstances provide VAT Refunds to UAE entities. Please note for Businesses which are resident in any GCC State that is not considered to be an Implementing State according to the tax legislation, this condition does not apply and hence such foreign businesses can still apply for these Refunds.
  • The Foreign Business is a non-resident tour operator.

The approved list of countries with reciprocal arrangements has been provided by the UAE Ministry of Finance (MoF) and can be found in the List of Countries with Reciprocal Agreements for the Business Visitors VAT Refunds (“Approved List”) on the FTA’s website. 

Related: VAT Updates on Business Transfers, VAT Audit

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