☰
IMC Logo
×
Amendments to the UAE VAT Regulations Important Things Businesses Shouldn't Miss Out

Amendments to the UAE VAT Regulations: Important Things Businesses Shouldn’t Miss Out

  • Modified On: January 12, 2026

Follow Us

Share

Share on facebook
Share on twitter
Share on linkedin
Share on email

The VAT Executive Regulations (VAT ER) in the UAE have undergone significant amendments, which can bring about significant implications for your business. The revised set of norms has come into effect from 15th November 2024. Businesses across different verticals are likely to be affected, while the consequences will be specific to the financial services industry.

In this edition, we have outlined the key amendments every business should know.

VAT Exemption for Financial Services

Under Article 42, the VAT exemption for financial services companies has been expanded. The revised provisions include:

  • Fund management services: This refers to services provided by a fund manager to licensed investment funds, like managing operations, investments, and performance.
  • Virtual assets: According to the revised norms, the exemption now covers the transfer and management of virtual assets like cryptocurrencies. These changes are retrospective and will affect transactions from January 1, 2018. These exemptions will simplify compliance and eliminate VAT invoicing obligations, but they can complicate input VAT recovery, particularly for fund managers. With professional VAT Consultancy Services in UAE from experts, businesses can simplify this process.

Zero-Rate for Export of Goods

Amendments have been made to Article 30, which clarifies the documentation requirements for exporting goods under a zero-rate VAT. The amendments offer a greater degree of flexibility, acknowledging that different export scenarios may require varying documents.

Now, businesses can retain customs declaration or the Bill of Lading as evidence for applying the zero rate. This will help organizations address challenges related to obtaining necessary documentation for exports.

Zero-Rate for Services and Transport

Changes have also been made to the zero-rate VAT application on services, particularly regarding international transportation and related services. These include:

  • Export of services: Certain services like installation of goods or real estate services don’t qualify for the zero rate any longer.
  • International transport: Only the international segment of transportation can be zero-rated unless provided by the original service supplier.
  • Transport-related services: The amendments clarified certain conditions for zero-rating services related to the operation or maintenance of different means of transportation.

Input VAT Recovery on Health Insurance

With the latest amendments now in place, businesses can recover input VAT on health insurance expenses for one spouse and three children under 18. This change is likely to mitigate the administrative burden companies used to experience previously while tracking input VAT on the health insurance of their employees.

Exemption for Supplies by Government Entities

According to Article 3 (bis), a new provision has been included to exclude certain transactions between government entities from VAT. These include:

  • Transfer or disposal of government real estate or buildings
  • The right to use or exploit these assets
Also, a new threshold of AED 250,000 currently applies to deemed supplies by government entities and charities. In case the VAT amount is below this mark, the transactions will not be subject to VAT.

Other Key Changes

Some of the other amendments that impacted different areas are:

  • Tax invoices: New timelines for issuing summary tax invoices (14 days after the calendar month)
  • Input VAT recovery: The amendment clarified how to calculate input VAT recovery entitlement, particularly for businesses with tax years shorter than 12 months
  • Composite supply rules: Clarifications on VAT treatment for supplies consisting of multiple elements
  • Profit margin scheme: Following the amendments, the “purchase price” now includes all related costs and fees beyond just the product price
  • VAT registration cancellation: The FTA can now cancel VAT registrations if businesses fail to meet certain conditions
Implications and Next Steps for Businesses
The latest amendments in the UAE are likely to affect businesses across several sectors. Therefore, businesses must review their operation and identify transactions affected by these changes. As the new set of norms is already in place since 15th November, businesses are coordinating with top companies offering VAT Consultancy Services in UAE, like the IMC Group. These experts will provide a detailed analysis of how the changes can affect a business and suggest practical steps for adaptation.

Expand your business faster with our Global Capability Center

Global Entity Management is more than compliance

Let’s build the full structure right

Recent Posts

Don’t rely on assumptions

Conduct Due Diligence across HR, financial, and operational areas.

Your Vision, Our Mission.
Let's Discuss.

Contact Us
IMC Logo
Your Vision, Our Mission.
Let's Discuss
Make an Enquiry
Linkedin-in X-twitter Facebook-f Instagram Youtube
Get Started
About
Our Offices

UAE

NBQ Building, Office no. 303, P.O. Box 115887,
Khalid Bin Al Waleed Road, Bur Dubai,
United Arab Emirates

SINGAPORE

143 Cecil Street,
25-04B GB Building,
Singapore – 069542

INDIA

No.7 Sriji Palace,
17, E.V.K Sampath Road,
Vepery, Chennai – 600 007

© IMC
WhatsApp Icon
✖
IMC Logo IMC Group
WhatsApp Icon Start Chat