How Can Tourists Get a Tax Refund in the UAE?
The VAT refund for tourists is a great way to make your trip abroad more affordable. In a landmark decision, the UAE Federal Tax Authority has released VAT refund guidelines for tourists visiting the country. The new system will allow international visitors to claim back tax on goods purchased in-country and shipped abroad at a time of departure; this is expected to have an immediate impact on tourism spending within Dubai’s borders. Since November 18, 2018, eligible visitors in the UAE have been able to receive VAT refunds on purchases made while they were in the country.
How Can Tourists Get a Tax Refund in the UAE?
Following implementing VAT in the UAE, the FTA has made tax refunds available to tourists through an integrated computerized framework. To make your purchasing experience in the UAE even more delightful, the entire tax refund process is facilitated in an easy and timely manner, as shown below.
How does the UAE's tourist tax return plan work?
Tourists can get a tax return if they buy from businesses in the UAE that are members of the tourist’s tax refund system. The global operator planet is in charge of this facility, which has been approved by FTA. The electronic system of the Planet will be connected to the registered retailer outlets. Tourists can advise registered retailer shop employees of their desire to get a tax refund by producing travel paperwork such as a passport or GCC National ID card while making a purchase. The shopkeepers will then submit the information into the Planet’s system and attach a tax-free sticker to the invoices they issue. Tourists must preserve this invoice with them at all times, as it will be required to be submitted when filing a tax refund claim after their departure from the UAE.
Tourists must meet certain requirements in order to receive their VAT refunds.
A tourist must meet several requirements in order to receive a VAT refund on purchases purchased in the UAE:
- The items must be acquired from a store that is a member of the ‘Tax Refund for Tourists Scheme.’
- The Federal Tax Authority’s Refund Scheme does not exclude goods.
- He must have made it clear that he intends to depart the UAE within 90 days of receiving the materials, as well as the supplies he purchased.
Are there some items that tourists purchasing in the UAE are not eligible for a tax refund?
Tourists can seek a tax refund if the goods were purchased during their stay to the UAE, although there are some exceptions. The items listed below are not eligible for a tax refund.
- Any means of transportation, including a car, plane, or boat
- Goods have been eaten in part or in full in the UAE
- Goods are not in the tourist’s possession when they leave the UAE
In the event of any material purchases, it is critical to check if you are eligible for a tax refund ahead of time.
How does a tourist get a tax refund before leaving the UAE?
In the UAE’s different departure points, such as airports, seaports, and borders, there are specific tax refund validation counters. Tourists can go to these validation counters and present the purchased items, as well as supporting papers such as the original invoice with tax-free sticker, copies of passports, and credit cards, for refund claims. Tourists have the option of receiving their refund in cash or on their credit card. The reimbursement will be processed once the validation has been completed satisfactorily.
What other things should tourists in the UAE consider before claiming a tax refund?
The refundable amount will be 85 percent of the entire tax amount paid by visitors at the time of purchase. The remaining 15% goes to the system operator for the tourist tax refund scheme in the UAE, which is the administrative charge. If the return is made in cash, there is also a daily limit of AED 7,000. If the visitor has the money refunded to his or her credit card, there is no such limit. If you intend to do a lot of shopping during your stay in the UAE, you should be informed of the tax refund scheme’s effects so that you can budget accordingly.
I hope you now have a better understanding of tax refunds for travelers in the UAE. Do you have questions about tax refunds or other tax-related activities in the United Arab Emirates?
Alya Auditors can address your concerns and provide help in a variety of tax and accounting sectors. Alya Auditors is a company that provides tax accounting services. Alya Auditors have worked in a variety of entities in the UAE, establishing tax accounting and supporting tax-related activities. Our tax support services include everything from tax registration help to regular review, accounting, and reporting of tax actions. Please contact us if you’d like to learn more about how our services might help your company.