Dubai VAT Refund Program for Exhibition and Conference Services

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Introduction

The Federal Tax Authority (FTA) recently developed a User Guide for suppliers and recipients of  exhibition and conference services in response to Cabinet Decision No. (26) of 2018 on the Refund of  Value Added Tax Paid on Services Provided in Exhibitions and Conferences. It specifies the procedure to  be followed by suppliers and recipients in order to obtain VAT refunds for the provision of services to  international customers. For your reference, key aspects of the guide are summarized below.

VAT Refund Program for Exhibition and Conference Services

Eligible Services

The following services are covered by this refund program:

• Grant of the right to access, attend, or participate in an exhibition or a conference; or

• Grant of the right to occupy space to conduct an exhibition or a conference

An exhibition or conference is defined as any event or formal meeting that lasts no more than seven days. It involves the displaying, showing, or presenting goods or services, or is attended by people with a common interest, and is held following a permit issued by the competent government entity.

Qualified Persons

A supplier who has secured a license from the FTA to deliver Exhibition and Conference services in compliance with the FTA’s procedures and criteria.

Dubai VAT Refund Procedure

The Exhibition and Conference Services will be subject to a 5% VAT charge by the Supplier. The Supplier  will be allowed to reimburse the VAT amount charged on the Services if the Supplier does not collect the VAT amount from the International Customer. It entails passing on the advantage of the refund to the 

International Customer by guaranteeing that VAT is not a cost to the Customer.

Conditions

• For such a program, the Supplier must be licensed by the FTA;

• The supply consists of exhibition and conference services

• The Recipient does not have a fixed establishment or a place of business in the UAE;

• The Recipient is not registered for VAT in the UAE and is not required to register for VAT

• The Supplier has secured a signed declaration from the Recipient verifying the above

• The Recipient has not paid the VAT to the Supplier

Licensing requirements

1st Scenario

• The right to occupy space for exhibition or conference must be granted to the supplier (Applies  mainly in the case of hotels and companies in the UAE who rent space for events)

• Suppliers must be VAT registered in the UAE and have a permanent address in the UAE

• International customers are the recipients

• Suppliers must fill out and submit the ‘Supplier’s License Request Form to Grant the Right to 

Occupy Space’ to the FTA, together with other papers such as copies of trade licenses, venue  registration proofs, and so on

• The license is good for one year

2nd Scenario

• The supplier must have the right to access, attend, or participate in an exhibition or conference. (Applies to local and international event organizers, who sell tickets to non-UAE residents)

1. If the Supplier is a resident of the UAE, he must be VAT registered in the UAE.

2. If the Supplier is not a UAE resident, he must submit confirmation of  establishment in another country

• The recipients are international customers

• Suppliers must complete and submit the ‘License Request Form for Event Organizer to Grant 

Access to Events to the FTA, together with supporting documents such as event permits, sample tickets, and so on

• The license is only valid for single use

Processing time

• The FTA will review the application in 20 business days

• If it is approved, a business license will be issued through email within five business days

• The FTA will issue the license in the form of a letter, complete with its stamp

• The FTA does not charge a fee for such a license

International Customers Declarations

• That the International Customer does not have a fixed establishment in the UAE and is not a 

registrant or needed to register for VAT in the UAE;

• Parties’ information;

• The summary of the services requested;

• Exhibition/Conference specific details

Compliance

• Take and keep the original declaration issued by the International Customer

• Raise a tax invoice for the International Customer displaying 5% VAT, but do not collect it, as this would result in an automatic VAT refund to the International Customer. Furthermore, the tax  invoice should declare explicitly that “the supply falls within the special VAT return scheme”

• In the Tax Return, report the transaction related to the date of the supply of such services. The 

VAT shown on the tax invoice should be registered as output tax – Standard Rated Supplies and  deducted in the Adjustment column. It is not collected from the International Customer

Conclusion

The VAT refund program is a positive gesture by the FTA authorities, and it will be very advantageous to hotels and event/conference organizers in attracting international clients to events and conferences in the UAE. As a result of this arrangement, hotels can provide reasonable pricing for lodging space and participation fees without incurring VAT costs for international customers. The advantage, however, is limited to the VAT charged for the space supplied for the exhibition of products or services or the fee charged for attending the event

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