In the UAE VAT, the taxable event is the “supply” of goods and services. This means that every time a registered person provides goods or services, a 5% value-added tax is required. It is important for every company to understand the relevance of supply, because the relevance of supply determines the scope of the transaction should be subject to value-added tax.

What is supply under UAE VAT?

The term “supply” includes all forms of goods or services provided by registered taxpayers in the UAE state for the purpose of considering and conducting business. If you look at the definition of supply, there are 5 key components:

In order to determine whether a transaction falls within the scope of VAT taxation, each of the above elements needs to be considered. Let’s discuss it in detail:

Supply UAE VAT

Supply of goods and services Taxable supplies, supplies subject to reverse charging mechanism and imports of goods are within the scope of value-added tax collection. Duty-free goods are not within the scope of value-added tax.

Provided by a registered taxpayer It should be provided by a person registered under VAT or a person who needs to register.

The VAT provided by the UAE should only be paid when supplies are provided in the UAE. The supply location will determine whether to supply in the UAE.

The consideration provided here refers to anything that the taxable supplier collects or will collect from customers or third parties for the supply of goods or services. The consideration includes the value-added tax amount.

The business services provided in the course of conducting business include: any activity carried out by anyone on a regular, continuous, and independent basis anywhere, including industry, commerce, agriculture, professional, service or excavation activities or any activity related to the use of tangible items or intangible property

related articles:-

1. Supply of goods and services in the UAE VAT

2. UAE’s VAT rate

3. UAE VAT spare parts

4. UAE duty-free goods

5. The difference between the zero rate of VAT in the UAE, the difference between duty-free goods and out-of-scope supplies

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