UAE VAT Rules: Will Commissions of Local Agents be Charged?

The UAE has always been a hub for international business, with many foreign companies seeking to establish a presence. Most companies appoint local agencies or distributors as representatives.

Besides earning a commission, certain agencies also receive reimbursements for business or store-related costs, marketing contributions, and capital contributions to open or renovate a store. From a VAT standpoint, most companies treat commission income received from foreign principals as ‘export supply’, subject to zero-rated VAT…