Applications for VAT refund in the United Arab Emirates for non-resident foreign companies are currently being accepted by the UAE Federal Tax Authority; however, the deadline is fast approaching.

All applications for a refund on VAT incurred during 2018 must be submitted to the UAE Federal Tax Authority (FTA) by 1st October 2019. Foreign companies can check if they are eligible for a VAT refund by assessing the amount of VAT paid and what could potentially be reclaimed.

The Value Added Tax refund scheme is open to businesses which meet the following conditions:

• Companies who are not established in the UAE and have no physical form of establishment

• No fixed establishment in any other VAT impending GCC state

• Business owners who are not taxable individuals, in the UAE

• Must be a registered establishment with a capable authority within the jurisdiction they are set up

• They must be a company which is established in a country that implements VAT and provides VAT refunds to UAE based businesses

The period of the refund claim will be a calendar year, therefore the current upcoming deadline is applicable for VAT refunds through costs incurred throughout the 2018 calendar year. The minimum claim amount for each claim application is AED 2,000 – this can include single expense or multiple expenses, original tax receipts/invoices will need to be submitted with the application to the FTA.

There are only three situations where VAT cannot be reclaimed by a foreign business which meets the requirements, these include:

• If the foreign company makes supplies in the UAE, however, if the business must justify VAT under the reverse charge system

• If an input tax is blocked from recovery – this is in relation to goods or services

• If the foreign company is a non-resident tour operator

Only companies operating out of the following countries are entitled to this scheme:

• Austria

• Bahrain

• Belgium

• Denmark

• Finland

• France

• Kuwait

• Iceland

• Isle of Man

• Lebanon (in certain situations)

• Luxembourg

• Namibia (only for exported goods)

• Netherlands

• New Zealand

• Norway

• Oman

• Qatar

• Saudi Arabia

• South Africa (Only for good exported from a specific UAE port within 90 days)

• Sweden

• UK

• Zimbabwe

• Switzerland

If you require more information with regards to VAT regulations, PRO Partner Group and our financial affiliate, Premier Brains can assist you with further information and advice. For more information on Prakash Naik at PRO Partner Group direct on +971 (0)4 456 176 or finance@propartnergroup.com or please contact a member of the team on info@propartnergroup.com in Abu Dhabi +971 (0)2 448 5120, or Dubai +971 (0)4 456 1761.