Everything About VAT Refunds in UAE For Tourists

If you are planning a trip to UAE, there are not just one but numerous aspects you should be mindful of. Well, don’t be alarmed! Today’s details are designed to enhance and enrich your travel experience, making it more enjoyable and advantageous! Since the implementation of VAT in 2018 in UAE, the authorities have permitted tourists to claim back the VAT in UAE paid on their purchases. Travellers and visitors can claim a refund on VAT, which is spent on purchases they make while travelling in the UAE. The process of VAT return is initiated through a fully integrated electronics system, which keeps the retailers connected to all ports of exit and entry from UAE (registered under the tax refund for tourist scheme). Let us read more and find out everything about VAT in UAE and VAT Returns. 

What is Dubai & UAE VAT?

The Value Added Tax, or VAT, is a utilisation fee added to the total price of goods and services. This cost addition starts from the initial production stage to the final product ready for sale to two consumers. This price added to each stage of production and distribution is called VAT.

What is Tax-Free Shopping? 

Purchasing a particular variety of taxable items that will be exported under certain terms and conditions is called tax-free shopping in the UAE. Shoppers can easily receive tax refunds in UAE and Dubai on the items bought by validating their purchases at several exit points while leaving the country. These exit points are located at airports and other borders of the country. 

Tax Refund For Tourists Scheme

The Planet and Federal Tax Authority, the official operators of the tax refund system have come together to develop an automated Planet VAT refund system. This initiative aims to enhance the convenience and speed of VAT refunds in the UAE for both registered retailers and their customers. To claim a VAT refund in the UAE, remember the following:

• • All vendors must to follow the principles presented by tax refunds for tourist schemes. 
  • A minimum purchase of AED 250 is mandatory to obtain a tax-free tag. 
  • Documents, such as passport, GCC National I-card, purchased items and credit card information are required for submission. 
  • The vendors or retailers must put pertinent information on Planet’s computer system to claim a VAT refund. 
  • Each tax-free tag will be scanned while reclaim is in process to connect the purchased item to the customer’s GCC National I-card or passport. 

How Can You Claim a Tourist VAT Refund in UAE?

Travellers can collect their VAT refund via special devices placed at departure locations in airports, border ports and sea ports.

The documentation that one must submit includes:

• • A tax invoice of purchases made on each outlet registered under the Tax Refund Tourist Scheme
  • A copy of their credit card
  • A copy of their passport for verification

After successfully submitting and verifying the documents mentioned above, tourists have the option to receive a VAT tax refund in either UAE Dirham cash or have it credited back to their credit card. Tourists can also utilise e-service from FTA UAE to get a VAT refund upon departure from the country.

*Note: The traveller will receive 85% of the total VAT amount paid after deducting a fee of AED 4.80 per tax-free tag.*

• Where can Tourists Reclaim VAT on Purchased Items?

VAT refunds are made after passing through all validation points and device stations at departure points of airports, sea ports and other borders. Here are some pointers to remember:

• • Tourists must go through the designated validation point before checking their baggage. 
  • Get to the immigration counter and present the original receipt with a tax-free tag attached, purchased goods, and a copy of your credit card and passport for verification. 
  • After the validation, you can receive a VAT refund in the UAE and Dubai through either cash or card. 

• Eligibility Criteria for Refund of VAT in UAE and Dubai

To qualify for a VAT refund in the UAE and Dubai, certain criteria must be met: 

• • The tourist or traveller must be 18 years of age or above. 
  • GCC Nationals are also permitted to reclaim VAT in the UAE. 
  • They must not be a crew member on flights and ships leaving the UAE. 
  • The tourist should verify that the store or retailer where they made their purchase is part of the tourist tax refund scheme for VAT refund UAE.
  • Tourists must plan to depart from the United Arab Emirates within 90 days of their visit, including any items purchased during their stay.

These simple criteria must be kept in mind by every traveller applying for a return of VAT in the UAE. 

• Minimum Spending Limit to Qualify for VAT Refund

Several factors make a traveller eligible for a VAT refund in Dubai and the UAE. One of the requirements is a minimum spending amount. The traveller needs to have incurred a total of AED 250 in expenses to qualify for an 85% refund on the entire VAT amount paid for the purchase. The VAT refund service provider, Planet, charges the remaining 15% as administration fees. It’s crucial to highlight that, in accordance with the latest regulations from the FTA UAE (Federal Tax Authority), there is a daily cash refund limit of AED 7,000. According to this imposition by the Federal Tax Authority UAE, any VAT refund exceeding the per day limit will be paid via other means like Bank transfer or credit card returns. 

• • Inspection of Purchased Goods 

If the purchased items require an inspection, it will be done by the staff of Planet at their validation desk located at several exit points in the UAE and Dubai.

Here is what you need to know: 

• • Tourists must present the tax-free tags, tax invoices and purchase goods at the validation counter. 
  • After successful validation, tourists can choose their preferred refund mode. 
  • If your preferred refund mode is cash, you can visit the cash partner at the currency exchange office after you pass through immigration. 

Self-Service Kiosks

A newly launched service point, self-service kiosks, is available at departure ports, where tourists can do a VAT reclaim by themselves. It is an automated service streamlined by identifying your eligibility for VAT refunds at different locations like airports and other departure points, including Abu Dhabi International Airport, Dubai International Airport, Al Maktoum International Airport and others. Employees accompany these automated machines to make it easier for tourists to refund VAT in UAE. 

Refund Locations For VAT in the UAE for Tourists 

You can easily reclaim your VAT at the different self-service kiosks located at the following –

• Airports

• • Abu Dhabi Airport – Common area between all terminals
  • Dubai Airport – Terminal 1, 2, 3, and 3 Business
  • Sharjah Airport
  • Al Maktoum Airport
  • Al Ain Airport
  • Ras Al Khaimah Airport

• Seaports

• • Zayed, Abu Dhabi
  • Port Rashid, Dubai

• Land Borders

• • Al Ghuwaifat, at the border with Saudi Arabia
  • Al Ain, at the border with Oman
  • Hatta, at the border with Oman

Are There Any Goods Not Eligible For a VAT Refund in the UAE? 

All of the products and services with applied VAT are eligible for a tax reclaim, excluding items like – 

• • Items that tourists are not bringing back with them when departing from the UAE.
  • Vehicles such as, automobiles, aircraft and boats.
  • Products or goods that are opened or partially used in the respective country or any implementing state in the GCC.

Wrapping It Up! 

Tourists shopping in the United Arab Emirates have the opportunity to request a refund on the VAT paid for their purchased items. We trust that this blog has provided valuable information. By adhering to straightforward rules and regulations, you can maximize the benefits of each trip to the Middle East.. Log on to www.squareyards.ae for more information about travelling to the Emirates.

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