Federal Decree Law No. (8) of 2017 on Value Added Tax
HH Sheikh Khalifa bin Zayed Al Nahyan, President of the UAE and Ruler of Abu Dhabi issued the Federal Decree Law No. (8) of 2017 on Value Added Tax, which outlines the tax scope, rate, responsibility for tax, supply of goods and services in all cases, including supply in special cases, supply of more than one component, supply via agent, supply by government entities and cases of deemed supply. The law also defines the tax registration and deregistration, as well as mandatory tax registration, tax group, registration exceptions, tax registration of government bodies and voluntary registration. Rules pertaining to supplies also include date of supply, place of supply of goods, place of supply of water and energy, place of supply of services, place of supply in special cases and place of supply of telecommunication and electronic services.
The law also outlines the place of residence of the supplier, place of establishment, place of residence of an agent, value of supply of goods or services, value of import, value of supply for related parties, value of deemed supply, tax inclusive prices, value of supply in cases of discount of subsidies, value of supply of vouchers, value of supply of postage stamps, temporary transfer of goods, as well as profit margins and calculating and charging tax based on the profit margin earned.
In addition, the law states the zero rates of supply and exemption, the supply of goods and services subjected to a zero rate, supply exempted from tax, single and mixed supply, specific obligations to account for tax which include reverse charge, import of concerned goods, designated zones, transfer of goods in designated zones and exceptions for designated zones.
The law summarises the calculation of due tax, recoverable input tax, capital assets scheme, adjustment of tax after the supply date, tax invoice, tax credit notes, tax period, tax returns and reclaiming of tax as well as carrying forward the excess of recoverable tax and tax recovery. The law also stipulates the provisions of tax recovery, violations and penalties, tax evasion in addition to general provisions and closing provisions. This Decree- Law will be published in the Official Gazette and will come into effect as of January 1 2018.
View the text of the Law