VAT Responsibilities and Treatment for Imported Goods on Behalf of Another in UAE

When goods are imported on behalf of another taxable person, the VAT treatment depends on who is declared as the Importer of Record. Scenario 1: If Mr. Rogers is the Importer of Record, he is responsible for the import VAT, which he reports in his VAT return and can claim as input VAT if used for taxable business purposes. Mr. Steve provides a service and charges VAT on his service fee.Scenario 2: If Mr. Steve is the Importer of Record, he is responsible for the import VAT, which he reports and claims as input VAT. He recharges the machinery cost plus service margin to Mr. Rogers, issuing a VAT-compliant invoice. Mr. Rogers can claim input VAT on this invoice.Scenario 3: If Mr. Steve is the Importer using his Import/Export Code but is only facilitating clearance, he must adjust his VAT return to reflect that he is not the true importer.

Source: claemirates.com

Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.

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