How to claim for VAT refund in the UAE?

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The UAE VAT (Value Added Tax) laws specify a VAT refund scheme, whereby overseas tourists and visitors can claim a refund on taxes paid for purchases they made through eligible outlets in the UAE. Tourists can recover the amount at VAT refund points allocated by the FTA (Federal Tax Authority) which are placed in airports, seaports, and border crossings of the country. However, in order to claim for VAT refunds in the UAE, the minimum spent should be 250 dirhams and certain conditions are to be met.

Conditions to be fulfilled for VAT refunds in the UAE

In order to be eligible for VAT refunds in the UAE,

  • Goods must be purchased from a retailer who is a part of the ‘Tax Refund for Tourists Scheme’
  • Goods purchased should be eligible for refunds and are not excluded from the scheme
  • The customer is leaving the UAE with the goods purchased within 90 days from the date of supply made
  • In case of exporting, the customer must export the goods within three months from the date of supple made
  • The process of purchasing or exporting the goods must be in compliance with the FTA regulations

Goods eligible for VAT refund in the UAE

Almost all taxable goods are eligible for VAT refund EXCEPT for:

  • Goods that are consumed wholly or partially in the UAE
  • Motor Vehicles, boats, and aircrafts
  • Goods that do not accompany the tourist whilst leaving the UAE.

Step by step process to claiming for VAT refunds in the UAE

  1. Before checking in the luggage, approach the specified refund points with the concerned goods and receipts
  2. Scan or enter the passport number (or GCC national ID card)
  3. Once you follow the instructions on the screen, a green light will appear indicating that have completed the validation process (In case of red light, feel free to seek assistance from the staff present)
  4. Choose preferred refund method cash (max. 10,000 AED) or credit/debit card.
  5. Vat refund is initiated

How to purchase items through the VAT refund scheme?

  1. Make a purchase from a retailer registered with the ‘Tax Refund for Tourists Scheme’
  2. Provide Passport or GCC National ID to the shop assistant so as to link it to the Tax-Free tag (The same should be used while claiming at the refund point)
  3. Shop assistant enters the transactions and attaches the Tax-Free tag to the back of the receipt
  4. The tax-free tag is scanned and the transaction is linked to the passport it GCC ID card provided.

How much amount does the tourist receive through the VAT refund scheme?

Through the VAT refund scheme in the UAE, the tourist will receive an 85% of the total VAT amount paid. However, an admin fee of 4. 80 dirhams will be charged as per the Tax-Free tag.

Can you transfer the VAT refund amount to debit/ credit cards in the UAE?

Tourists can receive their VAT refunds from the concerned points either in cash in dirhams or via credit cards by choosing the preferred refund method. In case of a cash refund, the maximum refund amount is 10,000 AED per tourist and any excess amount must be paid to the debit/ credit card.

Is there an expiration date for tax-free tags in the UAE?

The tax-free tag has to be validated within 90 days of making the purchase and failure in doing so will cause the expiration of the tax-free tag and you will not be able to refund the amount.

For the past 17 years, Flying Colour Tax consultants and Flying Colour Group have been helping clients in Dubai by providing them with required advice and assistance on tax-related matters. Our experienced tax consultants are ready to clarify all your doubts regarding VAT in the UAE. Please feel free to mail your queries at info@flyingcolour.com or contact us at +971 4 4542366.

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