VAT Administrative Exceptions User Guide
Since the implementation of value added tax (“VAT”) in the UAE, the Federal Tax Authority (“FTA”) has issued various Federal Laws, Decisions and Public Clarifications. The purpose of all these documents has been to streamline the procedural aspects of the Laws and Regulations. However, some of the procedures provided might not be suitable for various entities due to the variable business processes.
Keeping this dilemma in view, the FTA has recently issued the “VAT Administrative Exceptions User Guide”. This User Guide provides registrants with concessions/exceptions allowed by the Federal Decree-Law No. 8 of 2017 on Value Added Tax (“Law”) or Cabinet Decision No. 52 of 2017 on the Executive Regulations of the Federal Decree-Law No. 8 of 2017 on Value Added Tax (“Executive Regulations”), if difficult circumstances prevent them from following certain procedural aspects of the Law or the Executive Regulations.
Eligibility to make a VAT Administrative Exception Request:
In accordance with the User Guide, one shall be allowed to request if:
1) They are a registrant with the FTA; and
2) They are capable of providing relevant supporting documentation following the conditions mentioned in the User Guide.
Categories for VAT Administrative Exceptions:
- Tax invoices - Make a request not to mention the particulars of Article 59 (1) or 59 (2) of Executive Regulations for tax invoices; or not issue a tax invoice in certain cases.
- Credit notes - Make a request not to mention the particulars of Article 60 (1) of Executive Regulations for tax credit notes, or not issue tax credit notes in certain scenarios.
- Length of tax period - Applying for change in tax period keeping in mind the various conditions provided by the User Guide.
- Stagger – Applying for a change in the tax period so that the tax period ends as requested by the registrant.
- Extension of time for export of goods – Applying for an extension of time to physically export goods outside the UAE.
How to apply for a VAT Administrative Exception:
The application must be submitted by form which may be completed by the tax agent or legal representative of the registrant on their behalf. The application should mention the category to which you are applying, the reasons for application and provide supporting documentary evidence for same.
Response from the FTA on your VAT Administrative Exception:
A response can be expected within 20 business days where the VAT Administrative Exception request relates to the export of goods. Where the VAT Administrative Exception is concerning tax invoices, tax credit notes, length of tax period or stagger, the FTA shall decide within 40 business days. Please note however that response time is subject to completion of application and is at all times at the discretion of the FTA.
This is a great gesture on behalf of the FTA which may help many corporations mold their procedure in accordance with the User Guide, providing opportunity for enhanced business activities, resulting in higher profits.
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