Why UAE Exporters Often Accumulate Recoverable VAT
Export-oriented businesses may accumulate recoverable VAT because they incur VAT on eligible UAE purchases and operating expenses while making supplies that may qualify for zero-rated treatment.
Common expenses may include:
Raw materials
Packaging
Warehousing
Equipment
Professional services
Logistics
Rent
Local business purchases
Import-related costs
When eligible input VAT exceeds output VAT payable, the business may reach a refundable position.
However, exporters should not assume that every international transaction automatically qualifies for zero-rating. The applied VAT treatment should be supported by the relevant commercial and export evidence.
Exporters should review:
Export invoices
Customs documents
Transport evidence
Customer information
Payment records
Input VAT eligibility
VAT return treatment
Accounting reconciliations
A refund request should be supported by both sales-side export evidence and purchase-side input VAT records.
GetMyAccounting assists UAE exporters in reviewing zero-rated sales, export documents, input VAT eligibility and accumulated refundable balances.
