Updates to VAT Executive Decree-Law
On October 5, 2024 , the Ministry of Finance announced that the UAE Cabinet has approved Decision No. 100 of 2024, introducing amendments to specific provisions of the Executive Regulations under Federal Decree-Law No. 8 of 2017 on Value Added Tax. These amendments will be effective starting November 15, 2024.
Below is a summary of the key updates and their impact on taxpayers.
Key Objectives of the Amendments
● These changes aim to clarify essential VAT provisions and procedures. The amendments ensure consistency with previous changes made in the Decree-Law and other related tax legislation.
● These updates are part of the Ministry’s efforts to maintain a balanced tax environment, improve the investment climate, and attract more businesses and investors to the UAE.
● The changes also reflect the latest developments in market requirements and feedback from stakeholders, ensuring that the regulations meet modern business demands.
Notable Amendments
1. Alignment with Previous Laws
○ The updates synchronize specific provisions with Federal Decree-Law No. 18 of 2022, which previously amended the VAT Law.
2. Exemption for Investment Fund Management
○ VAT exemptions have been introduced for investment fund management services, promoting growth in the investment sector and reinforcing the UAE's position as a major investment hub.
3. Virtual Asset-Related Services
○ Specific services related to virtual assets are now exempt from VAT, further encouraging innovation and financial technology investment in the UAE.
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4. In-Kind Donations Exemption
○ In-kind donations between charitable and government entities (valued at up to AED 5 million over 12 months) are exempt from VAT. This change enables donors to reclaim VAT incurred on these donations, fostering greater societal contributions from these entities.
5. Taxpayer Deregistration
○ The FTA is granted new powers to deregister taxpayers under specific circumstances, which enhances tax system integrity and improves administrative efficiency.
These amendments reflect the UAE’s dedication to refining its tax environment and adapting to the evolving needs of businesses, ensuring a balanced and attractive economic climate for local and international investors.
If you have any questions or need assistance understanding how these new amendments affect your business, AMCA is here to help. Our team of experts is ready to provide guidance and support in navigating the latest VAT regulations.
Contact AMCA today for personalized advice and ensure your business complies with the updated tax laws.
Warm Regards,
AMCA
+971 4240 8784