How to file VAT returns in UAE?

MCA has shared a very comprehensive guide on  How to File VAT Returns. Refer to this Returns Filing page on our website for more details

Is 2017 subjected to VAT when a contract is signed for a period of 2017-2018?

Question Asked By: Tina

I am invoicing a IT-support contract that covers support during 6 months in 2017, and 6 months in 2018. Is the period in 2017 subject to VAT. I have heard that services rendered in 2017 are not subject to VAT; but I cant find the relevant source.

Reply by Girish Chand, Director, MCA

Reference to your query, services rendered in 2017 is not subject to VAT in 2018 despite the invoicing being raised in 2018. This is covered in the transitional clauses in the VAT law.

Should we file the VAT returns after we receive the payments from our clients?

Question Asked By: Ahmed

We have received a PO for the supply of equipment in the UAE market. We imported some items from the US. We have to pay VAT along with customs.

We charged our client for 5% VAT on our invoice. Our invoice is 30 days credit terms. Our customer normally delays the payment for 60 days or even longer.

Should we file the VAT returns or this can be delayed till we receive the pending payments?

Reply by Girish Chand, Director, MCA

VAT payment to the authorities is triggered based on time of supply as per VAT laws. All VAT liabilities during the determined VAT filing period need to be settled on or before the VAT return filing date. It has no relevance and cannot be linked to customer settling the invoice.

What is considered the Place of Supply for transport services if loaded in Point A and delivered at point B?

Question Asked By:  Ehsan

I have one clarification for place of supply for transport services (in our case its goods transport).

As per Article (22) of cabinet decision no. 52, Place of Supply of Certain Transport Services:
1. The place of the supply of each transportation service is the place where the supply of that transportation service commences, where a trip includes more than one stop and consists of multiple supplies in accordance with Clause (5) of Article (4) of this Decision.

As per above provision, if A material is loaded from Abu Dhabi and delivered in Dubai. The place of supply will be Abu Dhabi?

For submitting returns, we have to mention the emirates wise supplies. We want to clarify which place (emirate) should we mention in the returns.

1. Place of supply as per the above provision. (Abu Dhabi)
2. Place of supply as per our (supplier) registered place of business.
3. Place of supply as per (customer) registered place of business.

Reply by Girish Chand, Director, MCA

As per Article 72(1) of the Executive Regulations relating to VAT laws, the Taxable Person who makes a Taxable Supply of Goods or Services in the State must keep records of the transaction to prove the Emirate in which the Fixed Establishment related to this supply is located.

So it will be point 2 – Fixed Establishment of the supplier as mentioned in your query.