The VAT regulations in the UAE categorize tax invoices as a documented representation, either in written or electronic form, capturing the occurrence and particulars of a Taxable Supply. The Federal Tax Authority (FTA) mandates two types of tax invoices: Simplified (for specific cases) and Full (for values over AED 10,000), Non-compliance can result in penalties.
This article provides insights on essential details, formats, and recent amendments regarding VAT invoices in the UAE, emphasizing compliance with regulations to prevent disputes and ensure accurate reporting. For guidance, businesses can consult reputable VAT consultants In Dubai, Now Consultant, which offers support for various tax-related services.
FTA Tax Invoice Format UAE:
Companies are obligated to adhere to the prescribed FTA Tax Invoice Format in the UAE. There are two distinct categories of tax invoices:
- Simplified tax invoice
- Complete tax invoice
Simplified Tax Invoice:
In accordance with Article 59, Clause 5 of the executive regulations, a Taxable Person is permitted to issue a simplified Tax Invoice under the following circumstances:
When the recipient of goods or recipient of services is not a registrant, or when the recipient of goods or recipient of services is a registrant, and the consideration for the supply does not exceed AED 10,000.
Crucial information to include in a simplified tax invoice comprises:
- Clearly indicating “Tax Invoice” on the document.
- Providing the supplier’s (Registrant) name, address, and Tax Registration Number responsible for the supply.
- Specify the issuance date of the tax invoice.
- Offering a detailed description of the provided goods or services.
The total consideration indicates the Gross value of the supply (i.e., the value inclusive of VAT) and the corresponding tax amount charged.
Full Tax Invoice:
If the value of the supply surpasses AED 10,000, the registrant is obligated to furnish a comprehensive tax invoice to the customer.
Critical details to include in a complete tax invoice comprise:
- Clearly stating “Tax Invoice” on the document.
- Provide the name, address, and Tax Registration Number of the supplier (Registrant).
- Provide the recipient’s name, address, and Tax Registration Number, if applicable and registered.
- Assigning a sequential Tax Invoice number or a unique identifier for easy identification within any invoice sequence.
- Including the date of issuance of the Tax Invoice.
- Specify the supply date if it is different from the issuance date.
- Offer a detailed description of the delivered goods or services.
- Including, for each item, the unit price, quantity or volume supplied, applicable tax rate, and payable amount in AED.
- Indicating any provided discounts.
- Stating the total amount payable in AED.
- Display the tax amount payable in AED, including the applied exchange rate for currency conversion, if applicable and different from the UAE dirham.
How To Make Tax Invoice In UAE?
Generate a UAE VAT invoice by including essential details such as names, addresses, Tax Registration Numbers (TRN), and a unique invoice number. Clearly state the VAT amount separately from the total. For zero-rated or exempt supplies, explicitly mention the absence of VAT.
Keep thorough records of all invoices for accurate reporting. Ensure your invoice format aligns with UAE VAT regulations and is easily understandable. When sending or receiving invoices, prioritize proper signing and dating to prevent future disputes.
Can Proforma Invoice Be Used As Tax Invoice?
A proforma invoice is a preliminary bill used to request payment before delivering goods or performing services. Unlike a standard invoice with confirmed details, a proforma invoice includes estimated figures.
What Is The Tax Point Date On An Invoice?
The tax point date on an invoice is the day it is issued. It should be generated within a period of 14 days from the supply date.
Can We Write Short Name On Tax Invoices In UAE?
It is recommended to include the full name of the registrant applicant and the customer’s name on a tax invoice in the UAE. Using the full names is considered good practice, and abbreviations are not encouraged
Can a Customer Claim VAT On Simplified Tax Invoice?
Registered customers can claim VAT exclusively on standard tax invoices issued by VAT registrants. It’s important to note that simplified tax invoices do not afford customers the opportunity to make VAT claims.
Now Consultant Services in UAE
Companies must follow specific conditions and due process for issuing tax invoices to mitigate the threats of fines and penalties. For guidance, you can avail of UAE’s best tax consultancy services, Now Consultant, a leading agency with qualified professionals offering support for VAT registration, deregistration, compliance, excise tax, and more.