Do I pay VAT on imports at customs?

Article 48 – Calculation of Tax under the Reverse Charge Mechanism on import of Concerned Goods or Concerned Services 1. For the purposes of import of Concerned Goods, Clause 1 of Article 48 of the Decree-Law shall apply if the following conditions are met: a. At the time of Import, the Taxable Person can demonstrate that they are registered for Tax. b. The Taxable Person has sufficient details for the Authority to verify the Import and the Tax which shall be due on the Import and is able to provide these as required. c. The Taxable Person has provided the Authority with its own Customs registration number issued by the competent Customs Department for that Import, such Customs Departments to verify the Import subject to the rules set by the Authority. d. The Taxable Person has cooperated with, and complied with any rules imposed by, the Authority in respect of the Import. 2. Where the conditions mentioned in Clause 1 of this Article are not met, the Taxable Person shall account for Tax in respect of the Import in accordance with Clause 1 of Article 50 of this Decision. 3. Where a Taxable Person who has a Place of Residence in the State receives a supply of Goods or Services with a Place of Supply in the State, from a supplier who does not have a Place of Residence in the State and does not charge Tax on that supply, the supply shall be treated as being of Concerned Goods or Concerned Services subject to Clause 1 of Article 48 of the Decree-Law. 4. Where Clause 1 of Article 48 of the Decree-Law applies, the Taxable Person must: a. Account for Tax on the value of the Concerned Goods or Concerned Services at the rate which would be applicable if the supply of the Concerned Goods or Concerned Services was made by a Taxable Person within the State. Cabinet Decision No. 52 of 2017 and its amendments – As published by the Ministry of Finance 37 b. Declare and pay the Due Tax in the Tax Return which relates to the Tax Period in which the Date of Supply for the Concerned Goods or Concerned Services took place. 5. Where a Taxable Person accounts for Due Tax in accordance Clause 1 of Article 48 of the Decree-Law, the Taxable Person shall keep the following documents relating to the supply: a. The supplier’s invoice showing details and the Consideration paid for the Concerned Goods or Concerned Services. b. In the case of Concerned Goods, a statement from the relevant Customs Department showing details and the value of the Concerned Goods.

Article (42) Person Obligated to Pay Tax in respect of Import The Person appointed or acknowledged as an importer pursuant to the Common Customs Law shall be obligated to pay Tax due on imports. Page 14 of 26 26 من14 صفحة

9. Import of goods 9.1. Chapter summary The purpose of this chapter is to outline the specific rules that apply to goods imported into the UAE, including goods which enter designated zones and the rules which apply when such goods leave those zones. 9.2. How is import VAT accounted for? VAT is due on the import of goods into the UAE where those goods, if otherwise supplied in the UAE, would be taxable at the standard rate. This means that no import VAT will be due in respect of goods which would ordinarily be zero-rated or exempt from VAT. The manner in which this import VAT should be paid, and the timing of payment, is dependent on the status of the importer. 9.2.1. Imports made by non-registered persons Where the import is made by an individual or a business which is not registered for VAT in the UAE, VAT is due to be paid in respect of the import at the point of importation. As such, VAT must be paid prior to the goods being released to the importer. Import VAT is calculated on the value of the goods inclusive of any customs duty and excise tax that may also be due. Payment of VAT will need to be made directly to the FTA, separately from any payments which are due to the Customs authorities (for example, customs duties). VAT payment will be made to the FTA using the FTA’s payment portal. Once the VAT is paid, the importer will be able to proceed with the customs clearing process in respect of the goods. It should be noted that where an unregistered person imports goods using a VATregistered agent, such as a courier company, the agent will be responsible for paying import VAT to the FTA on behalf of the unregistered person. This agent needs to account for the relevant import VAT on their own tax return, and is not able to recover the VAT accounted for as input tax. The agent will also be required to issue a statement to the unregistered importer with details of the import and the VAT paid. 9.2.2. Imports made by VAT registered persons Where the import is made by a VAT registered person, the import VAT should be accounted for on the person’s tax return using the reverse charge mechanism. As a consequence, a VAT registered person may clear the goods through customs and be able to use the goods in the UAE even before the import VAT is accounted for to the FTA. 31 VAT Guide | Taxable Person | VATG001

Article (28) Value of Imported Goods 1. The value of imported Goods will be the customs value determined in accordance with the Common Customs Law plus Excise Tax, Customs duty and any other imposts apart from VAT. 2. For Goods temporarily exported outside the GCC Territory for completion of manufacturing or repair thereof abroad, these Goods shall be taxed when reimported on the basis of value added to them as provided for in the Common Customs Law. Chapter Six Exceptions

4.1.4 Login to FTA portal and make the Payment for VAT due Non-registered importers have to pay the applicable taxes before clearing the goods. Import VAT is calculated on the value of the goods inclusive of any customs duty and excise tax that may also be due. The importer shall log in to the FTA e-Services portal to proceed with and confirm the payment. To do so, go to the VAT tab as per the following screenshot and then follow the following steps: a. Click on ‘VAT301 – Import Declaration Form for VAT Payment’. b. Fill in the Customs Authority, Declaration Number and Declaration Date. Then click on Next button that appears at the right side of the end of the page. c. The screen ‘About Declaration’ will open and the declaration details (TRN number, import date, destination…etc.) will be automatically retrieved. Click on ‘’Next’ button that appears at the right side of the end of the page. d. The screen ‘Declaration Details’ will open and the declaration details (e.g. HS Code, Import Value, Customs Duty, CIF Value…etc.) will be automatically retrieved. Click on ‘Next’ button that appears at the right side of the end of the page to proceed to payment screen. e. Click on ‘’’Pay VAT’ button which will direct you to the e-Dirham gateway. f. Once you are redirected to the e-Dirham gateway, you will be able to make a payment through an e-Dirham or non eDirham card. g. Once the payment is processed successfully, a confirmation message will appear on the screen and you will receive an email confirmation that the payments has been successfully completed. After which the customs clearance process can be completed. 7 VAT Import Declarion User Guide