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How to Apply for a Tax Refund in Special Cases under the UAE Excise Tax Law

Which Individuals Can Apply for A Tax Refund in Specific Cases?

Article 22 of the Cabinet Decision No. 37/2017 outlines four categories of persons eligible for a tax refund in special cases:

Foreign Governments, International Organizations, Authorities, or Diplomatic Missions:

Those who have paid tax on excise goods accessed for official use only. Eligibility extends to countries with reciprocal agreements with the UAE on tax exemption or refunds.

Persons Registered in Another GCC Country:

Those who have paid tax on excise goods in the UAE, subsequently exporting them to another GCC country and paying tax there as well.

Business Conducted by Individuals Exempt from Taxes:

Individuals who have directly exported excise goods that were previously subject to tax payment by a taxable person in the UAE.

Business Activities (Indirect Export) by Non-Taxable Individuals:

The term “indirectly exporting excise goods” pertains to the exportation of goods that have already been subjected to tax payment by a taxable individual in the UAE. This is done through an overseas customer who has exported the goods.

What is Excise Tax in UAE? 

A Comprehensive Guide to Applying for a Tax Refund in Special Circumstances

The application process involves several steps:

  • Register With the Federal Tax Authority (FTA):

If not already registered, initiate the process by registering with the FTA as a taxable person for excise tax through the [FTA portal].

  • Fill Out the Refund Application Form:

Access the refund application form on the FTA portal and provide comprehensive details about your business, excise goods, tax period, the amount paid, and the reason for seeking a refund.

  • Submission Deadline:

Adhere to the submission deadline by submitting the refund application within five years from the date of eligibility.

  • Provide Evidence to Support Your Refund Application:

Depending on the category, furnish evidence such as official documents proving your status, tax registration certificates, tax invoices or receipts, customs declarations, and commercial evidence.

  • Verification By Customs Departments:

Customs departments will verify the type and quantity of the exported excise goods with the provided export documents. Accuracy and consistency with customs records are crucial.

  • Compliance With FTA Guidelines:

The information regarding the regulations and other guidelines can be accessed on the FTA website or via alternative communication channels which are important to comply with. Ensure the submission of required information, data, and documents.

  • Minimum Period and Amount Requirements:

To be eligible for a refund, your application needs to have a minimum of 1 month covered. Additionally, it must relate to tax paid on goods whose value meets or exceeds the amount prescribed by the Minister of Finance.

  • FTA Decision and Refund Issuance:

The FTA will issue a decision on your refund application within 20 working days from submission. Wait for the FTA’s decision before expecting a refund.

The UAE excise tax law offers a mechanism for businesses to claim a tax refund in special cases when they have paid more tax than owed on excise goods. By applying through the FTA portal and adhering to specified conditions, businesses can initiate the refund process. The FTA diligently processes refund applications, subject to certain conditions, and businesses can contact the FTA for clarifications or assistance.

In essence, this guide equips businesses with the knowledge needed to navigate the complexities of excise tax refunds, ensuring compliance and facilitating a smoother process for reclaiming excess taxes paid.

Special Cases: What You Need for a Tax Refund

To be eligible for a tax refund in special cases, it is essential to fulfill specific requirements. Here are some of the crucial criteria you need to meet.

  1. Sufficient and Convincing Documents: 

    The documents that you submit as evidence of the export of the excise goods must be sufficient and convincing. The Federal Tax Authority (FTA) may reject your documents if they are not adequate, and may ask you to provide alternative forms of evidence, depending on the type and nature of the export and the excise goods.

  2. Accurate and Consistent Documents:

    The customs departments will verify the type and quantity of the exported excise goods with the export documents that you provide, according to their customs procedures and the tax risk matrix that they coordinate with the FTA.

  3. Follow FTA Guidelines:

    The information, data, and documents that the FTA specifies for the refund application must be provided and submitted through the means that the FTA determines.

  4. Minimum Refund Period:

    The refund application must cover a minimum period of one month. You cannot apply for a refund for a shorter period unless the FTA allows it in exceptional cases.

  5. Minimum Tax Paid:

    The refund application must relate to a tax paid on goods whose value is equal to or more than the amount prescribed by the Minister of Finance in a decision issued for this purpose. You cannot apply for a refund for a lower amount unless the FTA allows it in exceptional cases.

  6. FTA Decision:

    Within a timeframe of 20 working days from the date of application submission, the FTA will decide on your refund application, either approving or rejecting it. You need to wait for the FTA’s decision before you can receive your refund.

The UAE excise tax law allows you to claim a tax refund in special cases if you have paid more tax than you owe on excise goods. The FTA will process your refund application and refund the tax surplus to you within a specified time frame, subject to certain conditions. If you have any questions or doubts about the excise tax law or the refund process, you can contact the FTA through their website, phone, or email. or you can contact a tax consultant in Dubai for guidance or help you in a better way.

 

Shayan Khan is an experienced Corporate Tax Consultant with over 4 years of expertise. He's skilled in negotiating and investigating taxes with government bodies like the Federal Tax Authority. Shayan excels in reviewing and drafting tax documents and offers strategic advice on complex tax matters. Clients trust his guidance in navigating tax procedures and minimizing liabilities. Read more