- Federal Decree-Law No. 16 of 2025 updates UAE VAT law to improve compliance, simplify reverse charge procedures, and introduce a five-year limit on input VAT recovery.
- Taxpayers no longer need to self-issue VAT invoices for imports under the reverse charge mechanism; supporting documents are sufficient.
- Input VAT must be recovered or refunded within five years, or the right to claim it is lost.
- The FTA can deny input tax recovery if the supply chain is linked to tax evasion and the taxpayer knew or should have known.
- Businesses risk permanent loss of old VAT credits, increased audit scrutiny, and must enhance supplier due diligence.
Source: acme-group.me
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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