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What is VAT in UAE and how will it affect you? All your questions answered

 

 

What is VAT?
Value-added tax is known in some countries as goods and services tax, or GST. This is a consumption tax imposed on product and services by the government.
What is the VAT rate?
The GCC VAT law provides for a uniform VAT tax rate of 5% VAT and certain services are specifically Zero rated Viz. International transportation.

When will it come into effect?
1st January, 2018 in the UAE and KSA.

 

 

Information for Clients

Does Fetchr do Domestic deliveries for you?

All Domestic transportation services will be charged with 5% VAT as per the regulations issued by the government.
Example: Fetchr will invoice its domestic clients with 5% VAT for its services rendered from January 1st, 2018.

 

 

Does Fetchr do Cross Border deliveries for you?

Cross border movement of goods will be charged at 0% VAT
Example:  Fetchr will invoice its clients with 0% VAT for its services with regards to cross border movement of goods subject to necessary evidential requirements with Fetchr.

 

 

Does Fetchr do International deliveries for you?

All International Delivery Services will be charged at 0% VAT
Example: Fetchr will invoice its clients with 0% VAT for moving goods from Outside GCC to GCC from January 1st, 2018.

In these cases, a 5% Import VAT will be charged at the port on the landed value of the goods plus the custom duty (which is declared to fetchr by the client)

Example: All clients moving goods international will have to pay 5% Import VAT on the value of the product at the port from January 1st 2018.

 

 

Key points to be noted

 

Pricing: VAT shall be charged additionally over and above the service charge.

Contracts: The terms and conditions of the contract shall be amended by mentioning clearly the VAT Tax clause. Fetchr reserves the right to collect the differential of VAT or any similar tax, in the event that VAT or any similar tax treatment as assessed by the relevant tax authorities is different from that as applied and collected.

Customer Invoicing: Fetchr will issue a tax invoice (format if any as specified in the regulations) starting January 1st 2018 to invoice its customers.

Quotations: Any quote provided by Fetchr will be exclusive of any Value Added Tax (‘VAT’) or any similar tax. VAT or any similar tax shall be charged extra as applicable.

 

 

For additional enquiries and questions email us at vat@fetchr.us

Disclaimer: All the above information provided maybe subject to change after the release of the Executive Regulations by the Federal Tax Authority. 

 

 

   

 

 

 

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