VAT in UAE: Latest Rules Regarding the Issuance of Tax Invoices in 2023
The UAE VAT Law defines tax invoices as a written or electronic document in which the occurrence of a Taxable Supply and its details are recorded. Taxable persons are required to issue a tax invoice in the UAE when they make a taxable supply. VAT consultants in Dubai can provide you with advice on the issuance of tax invoices.
You may need to know the situations where you are required to issue a tax invoice. Businesses should also understand the timeline for the issuance of tax invoices. For example, the amended UAE VAT Decree-Law contains a change in the date of issuance of the tax invoice. These and many other rules regarding the issuance of a tax invoice will be discussed in the following. Read ahead to power your level of VAT compliance in the UAE:
Who should issue a tax invoice?
As per the UAE VAT Decree-Law, a tax registrant making a taxable Supply is required to issue an original tax Invoice and deliver it to the Recipient of Goods or Recipient of Services. Apart from that, a tax registrant making a Deemed Supply is also required to issue an original Tax Invoice and deliver it to a Recipient of Goods or Recipient of Services if available or keep it in his records if there is no Recipient of Goods or Recipient of Services. Consult with tax agents in Dubai for further information.
What’s the new amendment on the date of issuance of a tax invoice?
As per the amended UAE VAT Decree Law, the time limit for the issuance of a valid tax invoice of 14 days from the date of supply has been extended to supplies that include periodic payments or consecutive invoices. In the old law, there was no time limit for the issuance of a tax invoice under these circumstances. The new amendments will come into effect from January 1st 2023.
What Data must be included in a Tax Invoice?
As per the UAE VAT Decree-Law, a tax invoice must contain the following data:
- A clear display of the word Tax Invoice
- Name, address, and Tax Registration Number of the Registrant making the supply
- The name, address, and Tax Registration Number of the Recipient if he is a Registrant
- A sequential Tax Invoice number or a unique number
- The date of issuing the Tax Invoice
- The date of supply (if different from the date the Tax Invoice was issued)
- A description of the Goods or Services supplied
- For each Good or Service, the unit price, the quantity or volume supplied, the rate of Tax and the amount payable expressed in AED
- The amount of any discount offered
- The gross amount payable expressed in AED
- The Tax amount payable is expressed in AED together with the rate of exchange applied where the currency is converted from a currency other than the UAE dirham
- If the invoice relates to a supply under which the Recipient of Goods or Recipient of Services is required to account for Tax, a statement that the Recipient is required to account for Tax, and a reference to the relevant provision of the Decree-Law
Data to be Included in a Simplified Tax Invoice
A simplified tax invoice can be issued if the recipient of the goods is not registered for VAT in the UAE or if the recipient is a VAT registrant but the consideration for the supply is AED 10,000 or less. The following data must be included in a simplified tax invoice:
- The term ‘tax invoice’ must be clearly displayed
- Name, address, and Tax Registration Number of the Registrant making the supply
- The date of issuing the Tax Invoice
- A description of the Goods or Services supplied
- The total Consideration and the Tax amount charged
Exemption from Issuing a Tax Invoice in the UAE
Even though the UAE VAT Decree-Law mandates the issuance of the tax invoice in all situations, there are certain exemptions as well. Persons making a taxable supply are not required to issue a tax invoice if the supply qualifies to be wholly zero-rated and there are sufficient records to establish the particulars of the supply. The best tax agents in Dubai can provide more details of the exemption from issuing a tax invoice.
Consult with the Best VAT Consultants in Dubai, UAE
Businesses must comply with the conditions and requirements for issuing tax invoices for which Tax consultants in Dubai such as Jitendra Chartered Accountants (JCA) can provide assistance. JCA is a 20-plus-year-old firm offering bespoke VAT consultancy services in Dubai. JCA is one of the leading tax agents in the UAE approved by the FTA. We have a qualified team who can help you meet requirements such as UAE VAT registration, VAT deregistration, VAT compliance / VAT Return, excise tax services, and services related to VAT reconsideration etc.