VAT Refund Expo 2020
The UAE government has recently introduced Cabinet Decision No. 1 of 2020 on the “Refund of VAT paid on Goods and Services connected with the Expo 2020 Dubai”. Offices of the Official Participants will be able to claim a refund on the VAT incurred by them on the import or supply of certain goods and services which will be mentioned below.
Offices of the Official Participants are the representative offices of the Official Participants for the whole period of preparation, operation, dismantlement of the pavilion and execution of all necessary operation and various other activities for participation in the Expo 2020 Dubai.
How does it work?
Official Participants of Expo 2020 will incur VAT on Goods and Services connected to the Expo 2020 as per the normal UAE VAT rules, however, in certain situations, these participants are able to recover VAT on certain goods and services which were imported or acquired.
If the official participant of Expo 2020 is not registered for UAE VAT, the refund applications will have to be made through the Bureau Expo 2020 by submitting a special request.
However, if the official participants of Expo 2020 are registered for UAE VAT, they can claim VAT via UAE VAT return.
What type of VAT can be reclaimed?
In normal scenarios, only VAT incurred in UAE for Goods and Services where they are connected or intended for making taxable supplies is refundable, however, if it’s not connected or intended for making taxable supplies, then it’s not refundable.
However, with the introduction Cabinet Decision No. 1 of 2020 for the duration for Expo 2020, Offices of the Official Participants can claim VAT incurred on the following five categories without the need to use them for taxable supplies;
- VAT incurred by the Official Participant on Goods and Services in direct connection with the construction, installation, alteration, decoration, and dismantlement of their exhibition space.
- VAT incurred by the Official Participant on Goods and Services in direct connection with the works and activities of organizing and operating the Official Participant’s exhibition space and any presentations and events within the Expo 2020 site.
- VAT incurred by the Official Participant on Goods and Services relating to the actual operations of the Official Participant, provided that the value of each Good or Service for which the Office of the Official Participant makes a claim is not less than AED 200.
- VAT incurred by the Official Participant in connection with all operations, services and activities provided for the purpose of participation in Expo 2020 Dubai, whether located within or outside the boundaries of the Expo 2020 Dubai site.
- VAT incurred on import of Goods for personal use of the Official Participant’s Section Commissioner-General, Section Staff and the Beneficiaries.
If expenses occur on Point 1 and Point 2 then a Certificate of Entitlement is required to apply for a VAT refund.
What is the certificate of Entitlement?
An Official Participant, whether if its registered for VAT or no, must apply for a Certificate of Entitlement before attempting to reclaim VAT on Goods and Services mentioned under Point 1 and Point 2 in the paragraph above. A certificate reference number will be provided to the Official Participant and must be referenced in all special refund applications concerning Goods and Services that fall under Point 1 and Point 2.
Requirements to apply for Certificate of Entitlement?
In order to apply for the Certificate of Entitlement, the following conditions must be met;
- The applicant must be an Official Participant of the Expo 2020 in Dubai, holding a valid Expo 2020 license number.
- A maximum of 20% of the exhibition or presentation space is allowed to be used for commercial purposes. Any more percentage than that will result in disqualification from the Certificate of Entitlement.
If the Certificate of Entitlement is not granted, the Office of the Official Participant will not be able to reclaim full amount of VAT in respect to Goods and Services acquired under Point 1 and Point 2 under the special rules. Instead, Office of the Official Participant may need to consider if any VAT related to such Goods and Services may be recovered under the general VAT rules application to a VAT registered person. Furthermore, Official Participants would still be able to use the special refund process to reclaim VAT for expenses that are not covered by Point 1 and Point 2, but covered by the other specified points.
How to apply for Certificate of Entitlement?
In order to apply for the certificate, following information need to be provided by the official participant to the Bureau through “Request Form”
- Area of the pavilion (in square meters) used by the Official Participant.
- Location of the pavilion.
- Details and percentage of commercial use of space (if any).
- Detailed description of the purpose of the pavilion space.
- Declaration which will include a confirmation on the following:
- That a notification to the Bureau will be made should any changes occur that would affect the eligibility to a Certificate of Entitlement.
- The understanding that the Certificate of Entitlement only gives right to claim VAT Goods and Services under Point 1 and Point 2.
If deemed necessary, FTA or the Bureau may perform inspection or request information and declaration to determine the purpose or use of any space or presentation.
What supporting documents are required for application?
- Expo 2020 license.
- Scan of passport and Emirates ID of the Commissioner-General of the Official Participant.
Once applied, it’ll take the Bureau up to 20 business days to review the application. If accepted, the Certificate of Entitlement will be issued within 10 business days. The certificate will be provided in a letter format and will be signed by the Bureau, and will be scanned and sent my email as well. The Certificate will have a unique reference number for the applicant. This certificate shall be issued by Bureau free of charge and will enable the Official participant to claim Expo 2020 related VAT Refunds.
Note: It is the responsibility of the holder of the certificate to inform the Bureau if it stops being eligible for a certificate of entitlement.
Refund application process
VAT registered participants can claim their Expo 2020 VAT refunds through normal VAT Return procedures.
VAT Non-Registered applicants shall need to proceed with VAT refund application through a special VAT Refund request and must provide following information to the FTA.
- Reference number of the Certificate of Entitlement, if the application includes
Goods and Services from categories 1 or 2 mentioned above.
- Reference number and date of the previous refund claim.
- Details of the supplies supported by original tax invoices / customs declarations.
- Description of the Goods and Services to demonstrate that they fall under the
categories of eligible Goods and Services as mentioned above.
- Declaration which will include a confirmation of the following:
- Notification to the Bureau should any changes occur, that would affect the
eligibility of requesting a refund.
- Confirmation that no other refund claim has been or will be made in respect ofthe Goods and Services disclosed in the application.
- Confirmation that any imported Goods included in the application will not besold without prior approval from the Bureau and payment of VAT
In addition to the above following Supporting documents must also be provided:
- Copy of the Certificate of Entitlement issued to the Official Participant.
- Copies of the tax invoices, including simplified tax invoices. Only invoices issued
to the eligible persons are allowed to be used to claim the refund.
- Copies of customs declarations issued in respect of imported Goods.
- If the application includes Goods and Services from category 5, the following is
-Copies of an employment ID that proves the employment of the personnel in
respect of whom the VAT is being reclaimed.
-Copies of documents that prove the relationship of the relevant beneficiaries.
-Bank account validation letter / certificate. This letter / certificate must be issued
and stamped by the bank and include details about the account holder’s name
(must be the same as the applicant’s name), SWIFT / BIC (as applicable), bank
name and the IBAN.
*Additionally, the Bureau may request to examine the Goods or Services in question (or nominate an authorized third party to do so)
It will take 20 business working days to review the refund application by FTA. If approved, the Official participant will receive the refund directly into its bank account from FTA within 30 working days of the approval.
How can Bestax help you in this process?
Over here at Bestax Accountants, our tax agents will take care of all the complexities of the procedures and will provide end-to-end services related to Certificate of Entitlement, VAT Refunds for VAT Registered and non-registered participants of the Expo 2020 while you focus on other important affairs for your business.
Our tax consultants will be available 24/7 for any guidance you may need and will always try to go above and beyond in giving you the best services you’ll ever receive.
Call: +971 56 7981808