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VAT update: UAE announces changes to provisions


Tyne Hugo Senior Associate tyne.hugo@bsabh.com
Tyne Hugo Senior Associate tyne.hugo@bsabh.com

The Ministry of Finance has recently announced Federal Decree-Law No. 18 of 2022 on the Amendment of some provisions of the Federal Decree-Law No. 8 of 2017 on VAT (the Amendment Law).

The Amendment Law amends some provisions of the Federal Decree-Law No. 8 of 2017 on VAT which shall take effect from 1 January 2023.

Some of the major amendments are the following:

  1. If Registered persons only make zero-rated supplies and don’t make (or no longer make) standard rated supplies, they can then apply for an exemption from VAT registration.
  2. Setting a 14-day period to issue a Tax Credit Note to settle output tax which puts it in line with the same time frame to issue Tax Invoices.
  3. If deemed necessary, the Federal Tax Authority (FTA) may forcibly deregister registered persons.

There are some further amendments to certain provisions to clarify and confirm their intended meanings.

These amendments have been made based on past experiences and challenges faced by various business sectors and with keeping in mind international best practices in line with the GCC Unified VAT Agreement.


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