UAE: Guidance on recent amendment to VAT regulation

Public Clarification No. 40 provides guidance on amendment to VAT regulation effective November 15, 2024

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March 21, 2025

The Federal Tax Authority (FTA) on March 14, 2025, published Public Clarification No. 40 to provide guidance on the amendment introduced under Cabinet Decision No. 100 of 2024 to the value added tax (VAT) executive regulation under Federal Decree-Law No. (8) of 2017 on VAT. The VAT regulation amendment became effective on November 15, 2024, and is the most significant amendment to the VAT rules since the implementation of VAT in the UAE.

Public Clarification No. 40 provides guidance regarding the following issues:

  • Supply of more than one component
  • Profit margin scheme
  • Zero rating the export of goods and services
  • Zero rating international transportation services for passengers and goods
  • Zero rating certain means of transport
  • Tax treatment of financial services
  • Nonrecoverable input tax
  • Apportionment of input tax
  • Tax invoices

Read a March 2025 report prepared by the KPMG member firm in the UAE

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