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UAE: New due diligence requirements for input VAT recovery related to tax evasion

Effective October 1, 2026

August 26, 2026

The Federal Tax Authority (FTA) issued Decision No. 13 of 2026, effective October 1, 2026, for purposes of Article 54(bis) of Federal Decree-Law No. 8 of 2017 on Value Added Tax. Article 54(bis) addresses the recovery of input tax on supplies that form part of a supply or supply chain connected to tax evasion. 

The Decision sets out the measures, procedures and conditions that taxable persons are required to apply to verify the validity and integrity of supplies. If these checks are not carried out before input tax is recovered, the FTA can deny recovery when it establishes that the input tax relates to a supply chain involving tax evasion.

Key changes include:

  • Supplier verification
  • Supply verification
  • Procedures
  • Exceptions

Read an August 2026 report prepared by the KPMG member firm in the UAE

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