In brief

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. 

Effective date

The amended provisions will become effective from January 1, 2023.

Summary of the amended provisions

Amended Article

Summary of Amended Provisions

Article 3 – Supply of services

  • Introduced clause 2 explicitly states that the functions of a member of a board of directors, performed by a natural person appointed as such for any government entity or private sector establishment, shall not be considered a supply of services.


KPMG comment:

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

  • The amended clause 3 adds additional clarification that if the place of establishment of the Taxable Persion is in the UAE, the taxable person must keep records of the transaction to prove the Emirate in which the place of establishment is located.
  • Further, a number of new clauses (4,5 and 6) were added that deal with specific rules for record-keeping in cases where supply is made through electronic commerce.
  • If the value of the taxable supplies made by the taxable person through electronic commerce exceeded AED 100,000,000 during the calendar year, he must keep records of the transaction to prove the Emirate in which the supply is received in the following way:
    • Starting from the first tax period that begins on or after July 1, 2023, for 18 months (where the prescribed threshold was exceeded during the 2022 calendar year).
    • For 2 years commencing from the first tax period of the calendar year that begins after the date on which the threshold was exceeded.
  • For the purposes of the above, electronic commerce refers to the process of selling goods or services through electronic means, an electronic platform, a store in social media, or electronic applications in accordance with criteria and conditions determined by the Minister.


KPMG comment:

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.

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