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VAT updates
TAX UPDATES IN THE UAE – WHAT YOU NEED TO KNOW?
Insight | HLB HAMT
HLB HAMT Partner Jay Krishnan, has detailed some important updates on VAT applicability for real estate, medical equipment, ESR and excise tax in our latest edition of our Insight supplement. TAX UPDATES: Since the COVID-19 pandemic there has been a huge surge and growth in E-commerce, with more and more consumers spending online and we now live in an on-demand digital economy. However, there have been some important changes made in relation to VAT when it comes to E-commerce. The VAT Guide on E-commerce was issued by the FTA in August 2020, and some of the changes include: • Goods purchased online that are to be exported are eligible for zero rate VAT if certain conditions are fulfilled. • Supply made by a non-resident to a non-registered person in UAE, the non-resident supplier is required to register for VAT and to account for VAT on supplies.
Real Estate – Owners Association & Management Entity: The Real Estate market is a key component and cornerstone of the UAE economy - and there have been very important updates made in this industry in relation to VAT. Pursuant to the change in law concerning ownership of jointly owned properties in Dubai: • All rights and obligations of OA will shift to Management Entity • All OA should deregister from UAE VAT • Non-compliance by OA will attract penalty of AED 10,000 • Management entities must ensure compliance with UAE VAT regulations or else hefty penalties will be imposed.
exponential increase in the need for PPE, face masks and other medical equipment. However, from February 28th, 2021 there will now be a 5% VAT on some medical imports. • Supply or import of certain medical equipment during September 01, 2020 to February 28, 2021 will be zero rated. • Any supply or import outside the aforesaid period will be subject to 5% VAT. • Medical face masks, Half-filtered face mask, Non-medical textile face mask, Single use gloves, Certain categories of chemical disinfectants and antiseptics intended for use on human body is qualified for the above exemption.
Zero Rating of Certain Medical Equipment: The COVID-19 pandemic triggered an
FTA Administrative Update: • FTA updated the VAT refund template.
