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VAT refund for Organizers of Exhibitions & Conferences

April 11, 2019

Organizers involved in Exhibitions & conferences are allowed to refund VAT value imposed on services required for setting up the events. This aims to boost the ease of doing business and enhance UAE's competitiveness in this sector. It also supports the application of the tax system efficiently in the country, keeping pace with the best global standards.

This move comes as part of the UAE government's efforts to support exhibitions and conference sector, having the UAE's status as a global hub. The conference and exhibition tourism sector contributes Dh2.39 billion annually to the national economy and is expected to grow to Dh5.1 billion by 2020.

*Exhibition meaning any event held, for no longer than 7 days, to display, show or present Goods or Services, in accordance with a permit issued from the competent government entity.

**Conference meaning any formal meeting held, for no longer than 7 days, attended by people with a shared interest, in accordance with a permit issued from the competent government entity.

Conditions to be satisfied to claim the refund from the FTA
  • The supply must be Exhibition and Conference Services.
  • The recipient of Services does not have a Place of Establishment in UAE.
  • The recipient of Services is not registered for VAT.
  • The recipient of Services has not paid the amount of VAT to the Supplier.
Scenario 1:

The Supplier is applying for a license to grant the right to occupy space for the purposes of conducting an Exhibition or Conference (i.e.Hotels and Companies in the UAE who rent space for events/exhibitions/conferences)

  • The Supplier must be registered with the FTA
  • The Supplier must have a place of residence in the UAE
  • The Supplier is in the business of renting our space for exhibitions or conferences
  • The Supplier must have a valid trade license issued by the competent government entity
  • The Supplier owns space for exhibitions /conferences, or has authority to rent or operate space for exhibitions /conferences
  • The Supplier’s venue is registered with the competent government entity for the purpose of ensuring that the venue meets minimum requirements to host an exhibition /conference

Note: This license will be issued for a period of one year.

Scenario 2:

The Supplier is an event organizer and is applying for a license to grant the right to access attend or participate in an exhibition or conference (i.e. (local and international event organizers which sell tickets to non-UAE residents)

Conditions for a resident (local) organizer:
  • The Supplier must be registered with the FTA.
  • The Supplier must have a valid trade license.
  • The Supplier must be registered with the competent government entity as an organizer.
Conditions for a non-UAE resident (international) organizer:
  • The Supplier must provide proof of establishment in an overseas jurisdiction.
VAT refund on Services supplied to International customers

Before being able to supply Services to International Customers under the refund scheme without collecting VAT, the Supplier must obtain a number of documents from the customers. The Supplier should collect from the International Customer a declaration which states that the International Customer:

  • does not have a Place of Establishment or a Fixed Establishment in the UAE; and
  • is not registrant or required to register for VAT in the UAE.

The Supplier must receive the above declaration letter and supporting documents (if any) before applying the VAT refund scheme. Where the conditions for the VAT refund are met, the Supplier must:

  • Retain the original declaration provided by the International Customer.
  • Provide the International Customer with a tax invoice.
  • Not collect VAT from the International Customer.
  • Report the VAT charged in respect of the Services as output tax in the relevant Tax Return.

The parties should retain records of all of the documentation issued and received under the scheme for the period of five years from the end of the tax period in which the license expired.

Note: Where the non-resident event organizer is selling tickets to resident and non-resident customers, the international event organizer must register with the FTA and collect VAT from the UAE residents. There is no minimum threshold for non-resident suppliers of goods and services in the UAE – that is, such suppliers may be required to register for VAT if they make any taxable supplies in the UAE.

Mechanism for processing the Refund Request by the Event Organisers;
  1. Get the declaration for not having the Fixed Establishment in UAE by the International Customer.
  2. Provide the International Customer with a tax invoice. The invoice should charge applicable VAT and refund the same amount (or less) stating that the supply falls under the special VAT refund scheme.
  3. Not collect VAT from the International Customer.
  4. Report the VAT charged in respect of the Services as output tax in the relevant Tax Return. In the same Tax Return, the Supplier should claim a VAT refund of the amount of VAT charged.
 

Are you a Local or International Event Organizers or Hotels and Companies who rent space for events/exhibitions/conferences and you want to know more about Getting License from FTA for VAT refunds in the UAE?

Get in touch with our team today to find out all you need to know!

Last Updated: 11th April 2019 This article is contributed by: CA Vipin Kumar Ahuja Senior Manager, Taxation


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