UAE National VAT Refund

United Arab Emirates (UAE) nationals can avail the refund of Value Added Tax (VAT) incurred on the construction of a new residence for personal use. The expenses must be related to a new building that will be used as the applicant’s primary residence and that of their family. This claim can only be made by a natural person who is a UAE national.

The VAT refund application should include detailed information about both the applicant and the property. After reviewing the application, the Federal Tax Authority (FTA) will provide a reference number if the application is deemed eligible. The FTA or a verification body appointed by them may request additional information to review the submitted documents. Once the final approval is granted, the eligible VAT amount will be refunded to the applicant.

Under UAE VAT Law, the construction of a building is considered a taxable supply. This means that VAT is charged on expenses incurred during construction, including building materials and contractor fees. However, UAE nationals can benefit from a VAT refund scheme that allows them to reclaim the VAT paid on constructing a new residence, subject to certain conditions. This scheme helps reduce the financial burden of VAT costs associated with building a new home, providing significant savings for UAE nationals.

If you are eligible then, this application must be submitted to the Federal Tax Authority within 12 months from the date of completion of the new residence.