UAE VAT Update - FTA Clarification (VATP040)

Effective: 15 Nov 2024 (made available to the public in mid of March 2025). 

Key Points from FTA’s Public Clarification: 

– Composite Supply: Must meet all Article 4(4) conditions – not automatic. 

– Deemed Supply: Only output tax above AED 2,000 is taxable. 

– Exports: 

  – Goods: Exit certificate still required pre-15 Nov 2024. 

  – Services: Presence of the recipient in UAE >30 days = not “outside UAE”. 

– International Transport: Zero-rating only if full service by one supplier. 

– Qualifying Transport: Fishing, drilling ships = no zero-rating. 

– Maintenance Services: Must be directly on board to qualify. 

– Virtual Assets: Crypto = VAT-exempt since 1 Jan 2018. 

– Medical Insurance: VAT recovery allowed for staff + family (1 spouse, 3 kids under 18) from 15 Nov 2024. 

– Input Tax Apportionment: VATGIT1 method still valid. FTA may require sectoral method. 

– Tax Invoices: No simplified invoices for reverse charge – full invoice needed unless FTA approves. 

Review your VAT compliance & documentation now!