VAT Updates - Extension of timeline for filing Tax Assessment Review Request and Reconsideration and
VAT Updates - Extension of timeline for filing Tax Assessment Review Request and Reconsideration and
The Federal Tax Authority (‘FTA’) has issued VAT updates regarding earlier this week:
Cases of extension of deadlines for accepting submission of Tax Assessment Review request or request for a Reconsideration
BDO Insights:
With increased audit activity on the VAT front, the FTA remains committed to supporting the business community by allowing the submission of the TARR and reconsideration requests beyond the standard deadlines, in cases of genuine emergencies or technical difficulties that may have prevented timely submissions.
Additionally, the expansion of the reverse charge mechanism to include precious metals and precious stones is a positive development for dealers of precious metals and stones easing cash-flow on account of VAT. This change is in line with the growing global demand for precious metals. The conditions and requirements for these transactions now mirror those of other transactions subject to the local reverse charge mechanism, ensuring consistency and alignment across various sectors.
If you would like to understand how the above amendments would be able to your business and need support, please reach out to one of our tax experts.
- Extension of deadlines for accepting submission of Tax Assessment Review request or request for a Reconsideration in certain circumstances (FTA Decision No.1 of 2025)
- Decision for Application of Reverse Charge Mechanism on Precious Metals and Precious Stones (Cabinet Decision 127 of 2024)
Cases of extension of deadlines for accepting submission of Tax Assessment Review request or request for a Reconsideration
| Summary/Key takeaway | Effective date of applicability |
| The FTA may accept late submissions for Tax Assessment Review Request (TARR) or reconsideration requests beyond the prescribed period of 40 working days. The scenarios for extension are enlisted below along with documentary evidence(s) required: a. The occurrence of an accident or a serious illness for the authorized signatory. b. The death of the authorized signatory, including the Legal Representative, or any of his/her family members (of first or second-degree). c. A temporary Business disruption that is beyond the person’s control. d. A damage of records due to a disaster. e. A general malfunction in the Authority’s systems. f. A sudden discontinuation of Business or Business records due to the installation of a new computer system. The Authority’s request for additional documents from the Taxpayer, provided that the Taxpayer can prove the inability to obtain such documents within the legally prescribed deadlines. A force majeure to be determined at the Authority’s discretion Additionally, the decision also highlights the instances wherein such requests for extensions will be rejected. The cases for rejections are as follows: a. The Taxpayer is unaware of their obligations. b. The delay was caused by the negligence of a third party on whom the Taxpayer relied, such as a Tax Agent or a Legal Representative. c. A complexity in the topic of the Tax Assessment Review request or the request for Reconsideration, due to which the Taxpayer could not submit the request on time. d. The Applicant was busy running their Business. |
01 March 2025 |
Application of Reverse Charge Mechanism on Precious Metals and Precious Stones among registrants in the UAE for purposes of VAT
| Summary/Key takeaway | Effective date of applicability |
| The decision aims to extend the applicability of VAT under reverse charge mechanism between VAT registered businesses in the UAE to include precious metals and precious stones. ‘Goods’ have been defined as precious metals (Gold, silver, palladium and platinum) and precious stones (Natural and manufactured (synthetic) diamonds, pearls, rubies, sapphires and emeralds) or a jewelry made of both provided the value of precious metals/stones exceeds the values of other components under the Decision. The conditions for the supply to be covered under reverse charge mechanism is same as Cabinet Decision 25 of 2018 concerning the application of VAT for Gold and Diamond among registered dealers in UAE. The Cabinet Decision highlights the requirement of a written declaration of intent (for resale/production) along with a proof of VAT registration from the recipient of goods. In the absence of declarations from the recipient, the supply will not be taxable under reverse charge mechanism and the supplier will be responsible for the VAT obligations. |
15 February 2025 |
BDO Insights:
With increased audit activity on the VAT front, the FTA remains committed to supporting the business community by allowing the submission of the TARR and reconsideration requests beyond the standard deadlines, in cases of genuine emergencies or technical difficulties that may have prevented timely submissions.
Additionally, the expansion of the reverse charge mechanism to include precious metals and precious stones is a positive development for dealers of precious metals and stones easing cash-flow on account of VAT. This change is in line with the growing global demand for precious metals. The conditions and requirements for these transactions now mirror those of other transactions subject to the local reverse charge mechanism, ensuring consistency and alignment across various sectors.
If you would like to understand how the above amendments would be able to your business and need support, please reach out to one of our tax experts.