VAT Refund System for Tourists in UAE is at its Final Stage

According to the FTA (Federal Tax Authority) of UAE, a new system for returning VAT (value-added tax) to visitors and tourists is at its final stage. This new system depends on the advanced and latest integrated digital system, in order to set up a connection directly with sale points, along with all the port of entry in UAE – letting the global operator interrelate among retailers that are registered with the FTA, allowing tourists in UAE to submit refund requests. VAT advisors – 5% VAT was implemented by UAE on all goods in January, although the UAE Cabinet approved VAT refunds for visitors and tourists, the global operator hasn’t been named yet.

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Conditions for Tax Refund

FTA outlined the basic conditions for tourists who are eligible for the tax refund, considering the Cabinet decision. Following are the conditions:

• The goods in question must be supplied to the tourists within the UAE borders.
• The tourist must have to leave the country within the given 90 days from the supply date – with the purchased supplies.
• The tourist must export the goods in question out of the UAE within the three months from the supply date.

The Cabinet decision also specifies that the tourists need to have goods purchased from the registered retailers, in order to get the tax refund approved. Also, the purchase process must be done according to the decision of FTA’s Chairman and the goods in question won’t be excluded from refund.

VAT correspondence – As it’s already mentioned above that VAT refund system for tourists in UAE is at its final stage, the FTA also declared that the retailers who meet the criteria will be free to register in the system and if any tourist wants to make a purchase with the intent to refund tax from a registered supplier, then the supplier must give them all the basic necessary documents that meet all the legal requirements. The tourist can then submit the claim directly with the system operator and can get the refund from the operator where the tourist had provided the adequate documents.

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