Place Of Supply Of Services — VAT Rules Explained In UAE

Businesses that are required to pay are subject to Value Added Tax (VAT) within the United Arab Emirates. It is imperative to identify the place of the source of supply of products or services. The place of supply determines the quality of service provided in or outside the UAE. Determining the source of supply may be a challenge for entrepreneurs. The place of supply is different, depending on the products and services. A VAT consultant in Dubai can be extremely helpful in this instance. Read on to learn more about the supply location within the UAE under VAT and how excellent VAT experts in Dubai can help.

Identifying the Location of the Goods Supply

The place of supply for goods is by UAE VAT Law. If the supply was made within the UAE. This does not include imports or exports to or from the UAE. If assembled or installed goods are imported or exported out of the United Arab Emirates, their source of supply is:

• If the product was built or installed within the United Arab Emirates.
• If the item was constructed or installed outside the United Arab Emirates.

Location of Goods Supply, Including Import and Export

A). Within the State Under the Following Conditions:

Exporting to a destination not in the Implementing States is part of the offer.

• In the Implementing State, a buyer of the goods isn’t registered for tax registration in the State where they are intended to be, and the total number of exports made by the same source to this State does not exceed the State’s mandatory registration threshold.
• The total exports from the same source in the Implementing State to the State are greater than the Mandatory Registration Threshold B, and the recipient of Goods is not registered with a Tax Registration Number (TRN) in the State.

B). Outside the State Under the Subsequent Conditions

One of the Implementing States tax registrants is among those who receive the grant.

• The cumulative exports of the same source to this State surpass the threshold for registration required by the State, and the person who receives the goods isn’t a tax-registered person in the State from the extent that the exports are done.
• The products are imported from an entity tax-registered in one of the Implementing States. Furthermore, the total value of imports from that supplier to the State is not greater than the Mandatory Registration Threshold. The person who receives the goods is not registered with a TRN.

Site of Supply in Certain Situations

• Suppose the provider doesn’t have a home within the UAE. The customer is a business entity with an address in the UAE, and the UAE is the place of the source.
• In the case of commodities-related services, the place where the service is performed is the location of supply.
• The location of the transportation facilities supplied to the lessee who isn’t in the UAE tax bracket and does not have a TRN in the implementing State is where the transportation facilities are provided to the user.
• Suppose the person receiving services is located in a different Implementing State and is registered as a taxpayer in that State. In that case, the location of the supply is the recipient’s residence.
• The location of the food and beverage supply catering, hotel, and restaurant service will depend on where the services are offered.
• The place of supply point for any artistic, cultural, academic, athletic, or other related services is where the services are rendered.
• The place of real estate will be used as the source of supply for services relating to real estate.
• The point where you begin the transportation will function as the source of the available transportation services.

Location of Water and Energy Supplies

When determining the location of the energy source and water supply, the following criteria must be met:

Suppose the items are sold to the Taxable Trader in an implementation state Taxable Persons residing in the UAE. In that case, The supply of all energy forms and water via the distribution system is regarded as if it was performed at the Taxable Trader’s location of residence.

Suppose water or any other kind of energy is provided through an energy distribution system and is supplied to a non-taxable individual by a tax-deductible person. In that case, the distribution system will be considered to have occurred at the place of actual consumption.

Location of Telecommunication and Electronic Service Provider

If the supply is utilized and used by the United Arab Emirates, the source of telecom and electronic services will be within the country. If the service is used and enjoyed in countries other than the UAE, it will be offered in the UAE. Whatever the country of origin or method of payment, true usage and enjoyment of all telecommunications and electronic services will be based on where the services are used.

How can ebs Chartered Accountants benefit?

ebs Chartered Accountants is a leading company in the UAE that offers desirable VAT consulting solutions in Dubai. Since VAT consulting plays a vital role in ensuring the smooth running of your business, We will keep on top of your taxes to simplify the process. We are experts who understand the regulations and rules governing taxation in Dubai.

Hire us today to meet all your VAT tax requirements.