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UAE Simplifies VAT Refunds For Home Owners

Thursday, February 6, 2020

The United Arab Emirates' Federal Tax Authority has announced the launch of a new service on its website to simplify the process for taxpayers of recovering value-added tax incurred in building their own new homes.

Under the new service, those who are eligible to recover VAT on new-build homes will be contacted by the tax agency. They will need to submit up to four documents online to obtain a refund. If the refund amount requested matches the value of VAT on the tax invoices provided then the refund will be approved and sent to the applicant's bank account.

The four documents that now need to be submitted with the application are: a copy of the applicant's family book, a copy of the applicant's Emirates ID, a building permit included in the certificate of completion issued by the municipality, and a document indicating the date from which the building has been occupied (such as an invoice for setting up electricity and water services).

FTA Director General Khalid Ali Al Bustani said: "Launching the online platform to recover VAT on the construction of new homes for UAE citizens is part of the Authority's strategy to provide best-in-class services and continuously revise executive procedures for tax legislation to ensure efficient performance, facilitate procedures, and achieve customer satisfaction among citizens, residents, and visitors."

Guidance was released in January 2020 for taxpayers on the rules regarding the recovery of VAT on the construction of new homes.

Taxpayers must seek a refund within six months of the completion of their residence.