VAT taxation in UAE

Upon our webinar dedicated to VAT taxation in UAE we identified differences between Ukrainian and UAE legislation concerning the following transactions:


i.             Export of marketing services from a UAE supplier may enjoy 0 rated VAT, while in Ukraine export of marketing services should be taxed at 20% rate. Before applying for the 0-rated VAT, there are certain conditions to be met, e.g. the services shall not be related to the real estate located in the UAE;

ii.            Payment of royalties to a royalty owner located outside the UAE or implementing GCC States is treated as import of services (licenses) and shall be subject to the UAE VAT of  5%, if the place of supply is in the UAE. In such case, the UAE VAT Registrant shall use the reverse-charge mechanism to account for the VAT and the overseas supplier shall be registered in the UAE for VAT purpose, if the recipient of service is not registered for VAT. while in Ukraine such transaction is VAT exempt.