Expenses incurred for claiming expenses in the United Arab Emirates. This is similar to his VAT refund system for businesses available in the European Union. Let’s take a closer look at the UAE’s corporate VAT refund system.
What is the UAE Corporate VAT Refund System? Under the
Corporate VAT Refund System, a foreign company can apply for his VAT refund on his expenses incurred in the UAE, provided the necessary conditions are met .
What is a foreign-affiliated company?
Foreign company means a company registered with the competent authority of the country in which it has its registered office.
How can a foreign company claim a tax refund?
A foreign company can apply for his VAT refund under the Corporate VAT Refund Scheme if:
a. The company is based in his GCC countries which have not implemented his VAT.
Businesses residing in non-VAT GCC states are eligible for the corporate VAT refund system. In the GCC, only the UAE and KSA have introduced VAT as of right now. Therefore, this programme is open to enterprises that are based in the other GCC states.
b. Is a foreign enterprise operating in a non-GCC nation that satisfies the following requirements:
In the jurisdiction where it is established, it must be registered as an establishment with an appropriate government.
The foreign company needs to register with the appropriate government under its jurisdiction as an establishment.
Should not be a Taxable Person
Any individual who is required to register under UAE VAT or who is registered under UAE VAT is considered a taxable person. A business claiming a VAT refund under the Corporate VAT Refund Scheme must not be a taxpayer for UAE VAT purposes. To understand who needs to register under his VAT in UAE, please refer to the article “Who needs to register under his VAT”.
Must be from a country that provides her VAT refund to UAE companies in similar situations.
It is important that the foreign company is from a country that provides her VAT refund to UAE companies in a similar situation.
Note: Taxes charged must not be related to non-refundable goods or services. Certain supplies aren’t eligible for input tax refunds, according to UAE VAT. For more information about these supplies, see the article Supplies Not Eligible for Input Tax Refunds. Foreign companies applying for a tax refund under the Corporate Value Added Tax Refund Scheme must ensure that they do not include any goods or services that are not eligible for a tax refund.
Who is not eligible for a tax refund under UAE’s VAT?
Foreign travel agents are not entitled to claim tax refund under the Corporate Value Added Tax