30 October 2023 – Mobile phones, tablets etc subject to anti VAT fraud measure
The United Arab Emirates has imposed the use of the VAT reverse charge on the domestic B2B sales of a range of electronic devices. The obligation for the supplier to not charge VAT, common in Europe, aims to eliminate the opportunity for VAT fraud.
From 30 October 2023, the recipient of in-scope devices sold within the UAE will have to account and report both the purchase and sale transaction. This means the vendor should not charge or collect VAT. This effectively eliminates any cash payment between the parties of VAT, which has been subject to cases of VAT fraud.
The domestic reverse charge applies on sales within the UAE where both customer and seller are locally VAT registered. And that the devises are intended for resale or use for manufacturing other electronic devices.
In-scope devices include:
- Mobile phones;
- Smart phones;
- Computer devices;
- Tablets; and
- Components for the above