VAT Credit in EXPO 2020

In 2020, the Federal Tax Authority (FTA) introduced a Special Refund Scheme whereby the Offices of Official Participants of EXPO 2020 are eligible to recover VAT on goods and services imported or acquired pertaining to certain conditions. The application for the VAT recovery scheme can be submitted in two ways, depending upon whether the participant is registered for VAT in the UAE or not. For official participants who are not registered for VAT in the UAE, the refund application has to be made through the Bureau by submitting a special refund application. Whereas for those who are registered for VAT in the UAE, the VAT could be reclaimed through their VAT returns. However, VAT registration is mandatory if the value of taxable supplies or imports (commercial or non-official purposes) in the UAE exceeds or is anticipated to exceed the mandatory threshold of AED 375, 000.

The Offices of the Official Participants however are able to reclaim VAT for five categories of goods and services without the need to use them for making taxable supplies:

1. VAT incurred by the participant on goods and services in direct connection with the construction, installation, alteration, decoration, and dismantlement of their exhibition space. In order to be eligible, the participant must be I possession of a Certificate of Entitlement issued by the Bureau.
2. VAT incurred by the participant on goods and services in direct connection with the works and activities of organizing and operating the exhibition space, presentations, and events within the EXPO 2020 site. In order to be eligible, the participant must be I possession of a Certificate of Entitlement issued by the Bureau.
3. VAT incurred by the participant on goods and services relating to the actual operations, provided that the value of goods or services for which the participant makes a claim is not less than AED 200
4.  VAT incurred by the participant in connection with all operations, services, and activities provided for the purpose of participation in EXPO 2020
5. VAT incurred on import of goods for personal use of the participant’s section commissioner-general, section staff, and the beneficiaries.

In order to be eligible to apply for the Certificate of Entitlement:

· The applicant must be an Official Participant of the Expo 2020 in Dubai, holding a valid Expo 2020 license number.

· Not more than 20% of the exhibition space or presentation is, has been, or is intended to be used for non-official or commercial purposes.

To apply for the Certificate, a Request Form must be provided by the Official Participant to the Bureau. The form must include:
· Area of the pavilion (in square meters) used by the Official Participant.
· Location of the pavilion.
· Details and percentage of commercial use of space (if any).
· Detailed description of the purpose of the pavilion space.
· Declaration which will include a confirmation on the following:

In addition, the following supporting documents must be provided with the application for a Certificate of Entitlement:

• Expo 2020 license
• Scanned copy of passport.
• Emirates ID of the Section Commissioner-General of the
  Official Participant.

It will take the Bureau up to 20 business days to review the application and if accepted, the Bureau will issue the Certificate of Entitlement within 10 business days. The certificate will be provided in a letter format and will be signed by the Bureau, scanned
and sent by email.

Every business venture in Dubai regardless of its size has to follow the rules and regulations as prescribed by the FTA. The assistance of an experienced professional can be very useful whilst starting your dream project in Dubai. Flying Colour has a dedicated team to assist you with any matters related to tax procedures in the UAE. Please feel free to mail your queries at info@flyingcolour.com or contact us at +971 4 4542366.