UAE FTA Issues Guidance on Optional VAT Profit Margin Scheme for Second-Hand and Collector’s Goods

• The UAE Federal Tax Authority (FTA) issued guidance on the optional Profit Margin VAT Scheme (VATGPM1) on 5 January 2026.
• The scheme allows VAT to be calculated only on the profit margin of eligible goods (such as second-hand goods, antiques, and collector’s items) to prevent double taxation.
• It applies to goods previously subject to VAT and acquired from non-registrants or taxable persons using the scheme.
• Businesses must follow specific record-keeping and reporting requirements, including maintaining a stock book and indicating profit margin VAT on invoices and VAT returns.
• No VAT is due if goods are sold at a loss or zero profit, and losses cannot offset profits from other sales.

Source: regfollower.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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