United Arab Emirates Tax Updates

UAE Updates VAT Guidance on Refunds for Foreign Businesses

The UAE Federal Tax Authority (FTA) has published an updated version of its VAT Refund for Business Visitors Guide dated 19 April 2021. The guide is meant to help foreign businesses and business visitors check if they are eligible to claim a VAT refund and to successfully complete the 'Business Visitor (VAT Refund Scheme for Foreign Businesses) VAT Refund Form'.

VAT Refund for New Residences

The Federal Tax Authority amended the Real Estate Guide to extend the time period for claiming refund on the VAT incurred for construction of a new residence. To avail refund the claim must be lodged with the FTA within 12 months from the date of completion of the newly built residence which was earlier restricted to six months.



Amendment of administrative penalties imposed for violation of Tax Laws and reduction of previously imposed penalties

The new resolution grants the UAE Federal Tax Authority (“FTA”) the right to reduce previously unpaid administrative penalties to 30% of the total penalties where the registrant has paid all taxes due by 31 December 2021.



Dubai Customs Notice no. 09/2021 relates to the import of personal goods via e-commerce transactions

With the purpose of regulating the movement of personal goods through E-commerce Channels, the Dubai customs vide Customs Notice No. 09/2021 has announced that companies wishing to practice the e-commerce activity must register / add the activity in the Dubai Customs’ customer registration system without the need to add the activity in the trade license.



Implementation of the TIR Carnet (International Road Transport)

Dubai Customs issued a Policy No 52/2021, announcing the implementation steps of TIR Carnet (International Road Transport) without the payment of customs duties and customs inspections. This facilitates the movement of goods within GCC.



New Mechanism for calculating the Average Retail Selling Price of Excise Goods

The FTA decided on the mechanism for calculating the Average Retail Selling Price (ARSP) of Excise Goods in the Market vide the Federal Tax Authority Decision No. 1 of 2021 issued on 28 April 2021. It determines the method of calculation of Excise goods’ values for goods intended to be sold in the UAE market for retail purposes and goods not intended to be sold in the UAE market for retail purposes.





Ecuador Approves Pending Tax Treaty with the UAE

On 11 May 2021, Ecuador's National Assembly approved ratification of the pending income tax treaty with the United Arab Emirates.

Ukraine Cabinet Approves Pending Protocol to Tax Treaty with the UAE

On 19 May 2021, Ukraine's Cabinet of Ministers approved for ratification the amending protocol to the 2003 income and capital tax treaty with the United Arab Emirates.

Full foreign ownership comes into effect:

The UAE Government had recently adopted an amendment to the law allowing 100 percent foreign ownership of companies.

"The amended Commercial Companies Law aims at boosting the country’s competitive edge and is a part of UAE government efforts to facilitate doing business, ” said Abdulla bin Touq Al Marri, Minister of Economy.

Sheikh Hamdan's New Digital Crowdfunding Platform Dubai Next aims to boost funding for innovative startups

H.H. Sheikh Hamdan bin Mohammed bin Rashid Al Maktoum, Crown Prince of Dubai and Chairman of The Executive Council of Dubai, has launched Dubai Next, a digital platform that will enable innovators and entrepreneurs in the Emirate to secure funding for their projects.

Corporate Tax