All you need to know about Tax Invoices- VAT in UAE

tax invoice

As a VAT registered person, it is required to issue a Tax Invoice, which states the details of all taxable supplies that has been made. In order to dictate the date of supply and determine the tax period in which the output tax should be accounted for, a tax invoice must be issued.

What is buyer created Tax Invoice?

There are cases where tax invoices are issued by the recipient or the buyer, such a tax invoice is known as the buyer created tax invoices.

In order to issue a buyer created tax invoice, the recipient must be registered for VAT and the recipient and supplier must both agree in giving the right to the recipient in issuing the tax invoice.

When to issue a Tax Invoice?

It is required to issue a tax invoice within 14 calendar days from the date of supply. A summary tax invoice can be issued when more than one supply of goods and services is made to the same recipient during a month.

 

While issuing a tax invoice it must contain:

  • The word “Tax Invoice” must be clearly displayed.
  • Supplier’s Name, address and TRN
  • If the recipient is registered for VAT, Name, address and TRN of the recipient
  • A sequential tax invoice number or a unique invoice number
  • Issue date of tax invoice
  • Date of supply
  • Description of the goods or services supplied
  • The rate of VAT, unit price, quantity or volume supplied and the amount payable for each good or service must be expressed in AED
  • Discount amount offered
  • Gross amount payable, expressed in AED
  • Rate of exchange applied along with tax amount payable, expressed in AED
  • If the invoice relates to a supply under which the recipient is required to account for VAT, a statement and reference to the relevant provision of law

What is a simplified Tax Invoice?

A simplified tax invoice can be issued if  the recipient is not registered for VAT and when the recipient is registered for VAT and the consideration for the supply does not exceed AED 10,000. It must contain:

  • Tax Invoice being displayed clearly
  • Registered supplier’s name, address and TRN
  • Tax invoice issue date
  • Description of the goods and services supplied
  • VAT amount charged and total consideration.

 

It is not required to issue a tax invoice:

  • When the VAT rate is 0% on the supply and there are sufficient records available to provide the particulars of the supply
  • Issuing a tax invoice is being considered as impractical by the FTA.

If you have any doubt about tax invoices call us 04 443 1604

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