Import VAT Guide for Registered and Non Registered Firms

Any Business intending to import goods to UAE will have to pay custom charges along with VAT. The VAT is computed on total value of CIF+ Customs Duty + Excise Duty (if applicable). In case of VAT Registered Business ,they can defer the payment of VAT to next return filling date and can claim the input VAT over the same under Reverse Charge Mechanism. They just have to submit their TRN Number to the custom department. Upon verifying the TRN, shipment can be cleared without payment of VAT being paid at import. There might be some cases where TRN number of the business is not updated in the custom department. FTA and Custom Department is trying to resolve the same. However in the meantime there are actions which can be taken in order to facilitate the clearing of imported goods. The following steps can be initiated to defer the VAT payment to next return filing by VAT Registered Business :

1. Log on to FTA Portal with the importing companies login credentials
2. Select “VAT” from the top task bar
3. Select “VAT 301 : Import Declaration Code for VAT Payment”
4. In the window which appears. Enter the Customs Authority where goods have been imported along with declaration number and declaration date
5. A form appears to be filled by importer for details with regards to shipment. Most of the details of shipment will be preoccupied in the form. We just have to confirm whether the same is correct or not
6. Upon confirming above, the portal will ask you to make the VAT payment .Select “Fetch associated registration number”, you should now see the option to defer the payment of VAT to the tax return. Click this option and submit the form

An importer who opts for service of Freight Forwarding Agent shall make sure to do the above procedure themselves remotely or specifically ask agent to clear the shipment with their own TRN . If the forwarding agent uses his own TRN to declare the shipment the importer will not be able to recover the VAT paid, as the input tax is not attributable to him. The above steps can also be opted by a non VAT registered importer when the custom authority asks to make the VAT Payment. The importer will have to sign up in FTA Portal. Login to the portal and follow the same procedure above. And in the payment option, the importer shall make payment using e-dirham or debit card.

Import Code

Any business intending to import goods to UAE, must obtain an import code. An import code is a code which is allotted by Dubai Customs for a company after successful approval from Registration Department of Dubai Customs. Documents required for the same are:

1. Company Trade License
2. Chamber of Commerce Certificate
3. An Undertaking Letter
4. Passport Copy of Manager
5. Visa Page Copy
6. Emirates ID Copy

Upon receiving the import code, trade can be initiated from all around the world in accordance with licensed activity in trade license. The blog post is written by Mr. Nadeem, Tax Advisor at Flyingcolour Accounting & Tax Services. At Flyingcolour, we can guide and help you with the import VAT payment for both registered and non-registered suppliers. If you have any query then feel free to call +971 4 4542366 today for a quality consultation or please send inquiry to info[at]flyingcolour[dot]com.