The UAE Federal Tax Authorities (“FTA) have published the UAE Cabinet of Ministers’ Decision No. 99 of 2022, issued on October 21, 2022, to amend The Executive Regulation of the Federal Decree-Law No. 8 of 2017 on Value Added Tax (“the UAE VAT Executive Regulations”).
The current amendments change the applicable rules to supplies made by independent directors and introduce new record-keeping and Emirates reporting requirements for e-commerce.
Considering the recent changes introduced into the Federal Decree-Law No. 8 of 2017 on Value Added Tax, it is expected that more amendments to the UAE VAT Executive Regulations will come soon.
The amended provisions will become effective from January 1, 2023.
Summary of the amended provisions
Summary of Amended Provisions
Article 3 – Supply of services
This amendment effectively removes the obligation for independent directors to apply for VAT registration and charge VAT on their remunerations. Equally, there would be no obligation for the registrant in the UAE to account for VAT under the reverse charge mechanism when receiving directors’ services from non-resident directors.
Article 72 – Record Keeping of the Supplies Made
All businesses with e-commerce supplies exceeding the above threshold should review their current methodology of Emirates reporting and adjust in accordance with the new rules.
KPMG has a team of experienced tax specialists that can help you assess your current tax position, advise on the appropriate tax treatment, prepare clarification requests, or represent you in front of the FTA as registered tax agents.
We are happy to discuss your specific circumstances with you and determine the way forward should you have any questions or concerns in this regard. Please get in touch with your usual KPMG contact or any of the tax professionals below.