VAT Refund Scheme For Expo 2020 Participants
The Federal Tax Authority (“FTA”) has announced Cabinet Decision no. 1 of 2020 on the Refund of VAT on Goods and Services for all the countries and companies cooperating in Expo 2020 Dubai. Cabinet Decision no. 1 of 2019 was cancelled, which was issued earlier. In the new Cabinet Decision, the FTA clearly says about which companies are permitted for a VAT refund and which expenses are subject to the VAT refund.
VAT refund criteria and process
The UAE government has announced a separate VAT refund application process for the companies. The Participants may apply for a VAT refund on the input tax experienced on import of goods or services and for expenses directly related to the Expo 2020.
The Participants can apply for a VAT refund for expenses, for example:
- VAT incurred on the construction, installation, alteration, dismantlement of the exhibition space for the Expo 2020.
- VAT incurred on goods and services for the operation, presentation and events within the Expo 2020 Dubai site. Some of the significant changes in the Cabinet Decision are:
- The Bureau Expo 2020 Dubai provides the list to the FTA of the Participants eligible for the VAT refund.
Based on the changes in the Cabinet Decision, the FTA extends the scope for VAT refund for Participants and clarifies the VAT refund application process with the Bureau Expo 2020 Dubai.
For whom is it applicable?
The update is applicable for the countries that have established a backup office in the UAE for the companies of their Expo 2020 site. Many of the Participants have already started the preparations of the Expo 2020, for example with the construction of their Expo 2020 site. In the preparation process, expenses may have been incurred on which local VAT is paid by the Participant.
What is next?
The Participants should:
- Consider the VAT refund possibilities in order to avoid that VAT paid on goods and services does not become a cost increasing factor. In addition, detailed refund eligibility analysis needs to be conducted with utmost care. Error or misinterpretation during the refund request may lead to financial and reputational risks for the participants.
- Assess the method of applying for the VAT refund, as it depends on whether you are eligible for VAT registration in the UAE:
- If you are not eligible for VAT registration, then you can apply with the Bureau Expo 2020 Dubai for a Certificate of Entitlement and VAT refund.
- If you are eligible for VAT registration, then you must register for VAT and apply for the refund through your periodical VAT return.
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Our services are available to all the Emirates in UAE. AGX is one of the accredited auditors for DIFC,DMCC,DAFZA ,JAFZA and all other Free Zones in Dubai and UAE.
We at AGX will assist you in taking care of all the procedures involved in the VAT process. Call us today for any kind of assistance at +971 50 2981990 or email us at agx@agxauditors.com to get all your queries addressed.