The need for accurate Emirate- specific  

In this article, we shall highlight the need for Emirate-specific reporting of taxable supplies in the UAE VAT returns.

1.    General Rules on Emirate-reporting in the UAE

• Standard-rated supplies must be reported per Emirate.
• The taxpayer’s UAE establishment is considered to determine the Emirate for reporting.
• Taxpayer must maintain records to prove the relevant Emirate for reporting.
• Reported in box 1 of VAT returns based on:

      I.          Emirate of the Taxpayer’s UAE establishment most closely related to the supply.

    II.          If Taxpayer has no UAE establishment, the Emirate where the supply is received by the customer.

2.    Emirate-reporting for Taxpayers involved in E-Commerce Supplies

• Who? Taxable Persons supplying goods and services through e-commerce which exceed AED 100 million in a calendar year.
• What? Emirates-specific VAT reporting of e-commerce standard-rated supplies.
• When? Effective 1 July 2023 or first tax period following the year the AED 100 million threshold was exceeded.
• How? Reporting based on the Emirate where the supply is received by the customer. Relevant supporting documents must be maintained.

Key Takeaways

• Taxpayers should develop and maintain a process to prove the Emirate in which VAT is reported in the VAT return.
• E-commerce suppliers should assess whether they fall within the new Emirates VAT reporting mechanism from 01 July 2023.