Weekly Spotlight: UAE Federal Tax Authority has announced some exceptional amendments to the VAT first accounting period

This week the spotlight is on VAT developments in the UAE, where the Federal Tax Authority has announced it has made some exceptional amendments to the first accounting period for those subject to VAT. The move follows calls from a number of VAT-subject authorities and institutions for an extension. The exceptional amendments include an extension to the accounting tax period from one to three months for some businesses and amending the quarterly tax period, scheduled to end during the first tax period at the end of January or February, to now end on the second tax period. The tax period for some businesses will, therefore, be four months and five months for other businesses. However businesses with a three-month tax period ending in March will not be affected by the amendments.

Elsewhere, the Tax Authority has clarified the import procedures non-VAT registered businesses should follow following the introduction of VAT in the country on 1 January 2018. Non-registered businesses looking to import into the UAE must follow standard customs procedures. They must either complete a declaration and pay through the e-Dirham system or through the eServices portal on the Authority’s website or via a clearing company approved by the Authority at the port of entry. Alternatively they can do so via a freight forwarder approved by the Authority or via a courier company where the goods are delivered to the importer. As well as following standard procedures when importing for re-export, transit, or temporary admission, non-registered businesses must provide a guarantee for the tax due on the imported goods in question, either by entering a previously obtained e-Guarantee reference number on the e-Services portal or via a clearing company approved by the Authority at the port of entry. Alternatively they may do so via a freight forwarder approved by the Authority.