Key Insights on FTA’s VAT Administrative Exceptions Guide
The UAE allows Value Added Tax (VAT) registrants to avail of the concessions/exceptions permitted in the VAT Laws and relevant regulations through a process called VAT Administrative Exception. By applying for VAT Administrative Exceptions in the UAE, VAT registrants can enjoy the concessions/exceptions granted by the Federal Decree-Law No. 8 of 2017 or Cabinet Decision No. 52 of 2017 if difficult circumstances prevent them from following certain procedural aspects of the Decree-Law or the Executive Regulation.
The Federal Tax Authority (FTA) has recently issued a VAT Administrative Exceptions Guide (VATGX1) that mainly provides an overview of the categories for which you can submit an exception request and an explanation of the fields and information you might see or need to complete the form. Tax agents in Dubai can provide you with further insights on the guide.
Who is eligible to make a VAT Administrative Exception Request?
To apply for VAT Administrative Exceptions in the UAE, you must meet the following eligibility requirements:
- The applicant must be a VAT registrant with the FTA
- You must meet the requirements in respect of the relevant Exception Request
- Submit all relevant supporting documentation
What are the categories covered under the VAT Administrative Exception?
Tax Registrants can apply for VAT Administrative Exception Requests only for certain specified categories. Such categories and the underlying conditions for the exceptions are listed below:
As per Article 59(7) of the Executive Regulation, tax registrants can make a request to not mention particulars specified in Article 59 of the Executive Regulation for Tax Invoices; or not be required to issue Tax Invoices in certain cases. The FTA will consider an exception request to tax invoice requirements if there are or there will be sufficient records available to establish the particulars of the supply or class of supplies, and it would be impractical for the taxable person to issue a tax invoice.
Tax Credit Notes
Tax registrants in the UAE can request an Exception not to mention particulars as prescribed in Article 60 of the Executive Regulation for Tax Credit Notes; or not be required to issue Tax Credit Notes in certain cases. Article 60(2) of the Executive Regulation allows an exception in these cases if sufficient records are available to establish the particulars of the supply or class of supplies, and it would be impractical to issue a Tax Credit Note. VAT consultants in Dubai can assist you with submitting the exception request for tax credit notes.
Length of the Tax Period
VAT registrants in the UAE can request the FTA to change the length of the Tax Period. If the registrant applies to change the length of the tax period to half-yearly. The FTA will only consider allowing this for categories such as individuals, businesses in refund positions and SMEs. As per Article 62 (2) of the Executive Regulation, the registrant should present a valid reason for requesting a change in the length of the Tax Period.
UAE VAT registrants who are on quarterly filing can request a change in the tax stagger assigned to them so that the tax period ends with the month requested by them. Article 62(3) of the Executive Regulation says that the registrants must provide valid reasons for requesting the change in stagger.
Evidence to prove the export of goods
Taxable persons who have registered for VAT in the UAE can request the FTA to permit the use of an alternative form of evidence to prove the export of goods. After the review of the request, the FTA may specify an alternative form of evidence in line with the nature of the export or as per the nature of the goods being exported. As per Article 30 (6) of the Executive Regulation, the registrant is required to provide the actual reasons/circumstances for requesting approval to allow the use of an alternative form of evidence and provide details of the alternative evidence proposed to be used. VAT consultants in Dubai can help offer you relevant advice.
Time for the export of goods
A registrant may request an extension of time to physically export goods outside the UAE. The FTA can extend the 90-day period from the date of supply. However, in Article 30(7) of the Executive Regulation, the registrants must provide the actual reasons/circumstances, as further defined in the legislation, on why an extension of time for the export of goods is sought.
How to Submit a VAT Administrative Request in the UAE?
VAT registrants are required to submit the Administrative Exception Request via the concerned person’s Emaratax portal on the FTA’s website. Tax agents in the UAE can help the registrants submit the request through the portal.
Who can submit the Application Form on your behalf?
The following persons are eligible to submit the VAT Administrative Exception Request in the UAE on behalf of the VAT registrants:
- The authorised signatory of the registrant
- The registrant’s appointed tax agent
- The registrant’s appointed legal representative
- A representative member in case an applicant is a tax group
What information is required in the Application Form?
Apart from completing the form, tax registrants need to provide a description of why they are seeking a VAT Administrative Exception. It should include the following information:
- A description of why you are making a VAT Administrative Exception Request as per the given criteria
- A supporting letter which includes a detailed background and the set of facts which support the administrative exception request, as well as detailed reasons why you are not able to meet the legal requirements and, hence, need the exception
- Any documentary proof to support the factual and legal grounds on which the request is based (e.g., alternative documents, sample invoices, contracts, payment slips or others)
Experts at Tax Gian can Help you with UAE VAT Requirements
Submitting VAT Administrative Exception Requests in the UAE can be a complex process for tax registrants. The assistance of VAT consultants in Dubai, such as Tax Gian, can help you complete the request as per the relevant laws and regulations. Tax Gian is a venture of Jitendra Tax Consultants (JTC), established by Jitendra Chartered Accountants, serving clients since 2001.
At Tax Gian, a dedicated team of tax experts are ready to share “gian” (meaning knowledge) with clients and accountants, new in the country or doing business for years, on the basics of VAT or any new updates released by the FTA. We are registered with the FTA as a tax agent and can offer end-to-end tax solutions for businesses of all sizes. Apart from VAT, we also offer excise tax and corporate tax consulting services in Dubai, UAE. We can also represent our clients before the FTA in case of any notices served by the Authority. Talk to our consultants for tax solutions that you can count on.