UAE VAT executive regulations: updates No. 100 of 2024

As the UAE evolves as a global business hub, its tax regulations change to keep pace. The new UAE VAT Executive Regulations No. 100 of 2024 introduces updates that businesses need to understand for compliance and tax optimization. Whether you’re a multinational corporation or a local entrepreneur, staying informed on these changes is key.

Let’s explore the most important updates in UAE VAT executive regulations No. 100 of 2024 and what they mean for your business.

The Essence of Change of UAE VAT executive regulations : Why the Update?

The revision of the UAE VAT executive regulations?in 2024, reflects the UAE government’s efforts to improve tax compliance. ( be aware of UAE compliance) and enhance economic competitiveness.?

?The Federal Tax Authority (FTA), working alongside advisory firms, has introduced these changes to simplify VAT processes and address ongoing challenges businesses have faced since the initial implementation of VAT in 2018. The new UAE VAT executive regulations?No. 100 of 2024 ensures that the UAE remains an attractive destination for global investors while maintaining a modern, efficient tax system.

Key Updates to UAE VAT executive regulations No. 100 of 2024

Several crucial updates have been made to the VAT Executive Regulation No. 100 of 2024, and businesses need to stay informed:

Definitions (Article 1):

A new definition for virtual assets, has been introduced. Encompassing digital value tradable electronically but excluding digital representations of paper currencies or securities.

Supply of Goods (Article 2):

The scope of real estate supply has been broadened to include any transfer of ownership beyond sales and tenancy contracts.

Exceptions from Supply of Services (Article 3):

New provisions specify exceptions for services, such as transferring government-owned buildings or real estate between government bodies

Deemed Supplies (Article 5):

Government bodies and charities are now allowed an output tax threshold of up to AED 250,000 on deemed supplies within 12 months before any excess is payable.

Voluntary Registration (Article 8):

Clarity has been provided on voluntary VAT registration, requiring evidence of conducting business and intent to make taxable supplies

Tax Deregistration (Article 14):

The FTA now has authority to deregister businesses if continued registration undermines the tax system’s integrity.

VAT Group Changes (Article 15):

A member of a VAT group must be removed if they no longer make taxable supplies.

Profit Margin Scheme (Article 29):

Calculation of profit margins now includes additional costs and fees incurred during purchase.

Zero-Rating for Export of Goods (Article 30):

Documentation requirements for proving export for zero-rating purposes have been clarified

Financial Services (Article 42):

New financial services, including the management of virtual assets, are now exempt from VAT under the VAT Executive Regulation.

Input Tax Recovery (Articles 52 & 55):

Businesses can now apply for a fixed apportionment recovery rate for input VAT based on the prior year’s tax return, with changes to thresholds for annual adjustments.

These updates in the UAE VAT Executive No. 100 of 2024 are designed to enhance transparency and simplify compliance for businesses, particularly in sectors that involve digital assets and new business models.

What’s Next? Preparing for the Future of UAE VAT

With these changes now in effect, businesses must ensure they remain compliant with the updates. UAE VAT executive regulations?while exploring potential opportunities for tax optimization. As the UAE economy becomes more digital and globally integrated, it is likely that further refinements to the VAT Executive Regulation will follow.

Working with expert tax advisors, like Parker Russell UAE, can help businesses navigate the complexities of the VAT Executive Regulation and leverage the updates for maximum benefit.

Stay Ahead in a Dynamic Tax Landscape

The updates in the UAE VAT executive regulations?No. 100 of 2024 reflect the UAE’s commitment to streamlining business processes and ensuring tax compliance. These changes are essential for any business looking to thrive in a competitive market. From adapting to cross-border services to handling digital assets, the regulation’s adjustments bring both challenges and opportunities.

For tailored advice on how to remain compliant with the VAT Executive Regulation No. 100 of 2024 and maximize your tax strategies, contact Parker Russell UAE today. Let us guide you through these changes, so you can focus on growing your business in one of the world’s most dynamic business landscapes.