The UAE Ministry of Finance announced, on 28 October, amendments to certain provisions of the UAE Value Added Tax (VAT) regime. The changes will come into force on 1 January 2023.

 The most significant changes include:

1. Under Article 15, those persons who are registered and make taxable supplies are permitted to apply for an exception from VAT registration if all their supplies are zero-rated and/or they no longer make any supplies other than zero-rated supplies.
2. Under Article 55, which deals with the recovery of pre-registration input VAT, the amendment now allows the taxable person to recover VAT paid or declared on the import of goods or services incurred by the taxable person before registration (on meeting certain requirements).
3. Under Article 62(2), a Tax Credit Note must be issued within a 14-day period if the taxpayer intends to adjust the output tax, in line with the time frame set for issuing tax invoices.
4. Under Article 65(4), it will be mandatory for the taxable person to pay the VAT to the Federal Tax Authority (FTA) in cases where such a person issues a tax invoice stating VAT on it or receives an amount as VAT.
5. The date of issuance of a tax invoice under Article 26 (date of continuous supply) will be 14 days from the date of the supply.
6. Under Article 33, the place of residence of a principal is redefined as the place of residence of the agent.
7. Under Article 21, the FTA is empowered to forcibly deregister registered persons in certain cases, where necessary. The deregistration of taxable persons will not forfeit the FTA’s right to claim any tax dues or administrative penalties.
8. The new article on the statute of limitation (Article 79 bis) sets out that:
9. The statute of limitation of five years will not apply to cases where the FTA has issued a notice to audit the taxable person, provided such an audit is completed within four years from the date of issuance of the notice.
10. In the case where the taxable person files a voluntary disclosure in the fifth year from the end of the relevant tax period, the statute of limitation will be extended by one year.
11. A voluntary disclosure cannot be filed by the taxable person after five years from the end of the relevant tax period.
12. The exception to the above is tax evasion, which has a 15-year limit.