VAT in Qatar (Our expectation)

Value Added Tax (VAT) is expected to be introduced in Qatar on July 1, 2024. The standard VAT rate is expected to be 5%, but there will be some goods and services that will be exempt from VAT or subject to a 0% VAT rate.

Exempt goods and services (expected):

• Education and healthcare services
• Financial services
• Real estate transactions
• Basic food items
• Exports and international transportation

Goods and services subject to a 0% VAT rate (expected):

• Goods and services exported outside the Qatar
• International transportation
• The supply of crude oil/natural gas
• The first supply of residential real estate
• Some specific areas, such as health care and education

VAT registration:

Businesses with taxable supplies of goods or services that exceed QAR 375,000 per annum shall be required to register for VAT. There shall also be a voluntary registration threshold of QAR 187,500 per annum. Non-resident businesses making supplies on which the Qatar VAT is required to be charged shall also required to register for VAT.

VAT returns and payments:

VAT-registered businesses shall be required to file VAT returns and make payments to the Dhareeba (Tax Authorities in Qatar) on a quarterly basis. The first VAT return will be due within 28 days of the end of the first tax period.

VAT invoices:

VAT-registered businesses shall be required to issue VAT invoices for all taxable supplies of goods or services. VAT invoices must include certain information, such as the supplier's name and VAT registration number, the customer's name and address, the date of supply, the description of the goods or services supplied, and the amount of VAT charged.

VAT refunds:

Businesses that incur VAT on their purchases will be able to claim a refund of the VAT from the Dhareeba/Qatar Tax Authorities. VAT refunds wll be claimed on a quarterly basis.

VAT penalties:

Businesses that fail to comply with their VAT obligations may be subject to penalties. The tax authorities in Qatar may impose penalties for failing to register for VAT, failing to file VAT returns, failing to pay VAT on time, and issuing incorrect VAT invoices.

The time will tell how much our expectations will be near to the reality when Qatar will actually introduce the VAT however we do believe that the results is not expected to change much from what we mentioned above.

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