UAE VAT – Current Policies and the Way Ahead

Nexdigm hosted a focused knowledge session unpacking the recent developments and future trajectory of UAE VAT law. It served as a practical briefing for tax professionals, CFOs, and compliance officers navigating a rapidly evolving VAT regime.

The discussion began with a detailed breakdown of the upcoming e-invoicing mandate. Attendees were taken through the phased implementation timeline, mandatory technical formats, and the transition to real-time invoice reporting via accredited Peppol service providers. The importance of organizational readiness, standardization using the PINT AE data dictionary, and common operational challenges were also discussed.

The session then moved into recent public clarifications issued by the Federal Tax Authority. This included a nuanced explanation of VAT treatment for cryptocurrency mining—distinguishing between self-mining and mining as a service—along with the conditions under which input VAT can be recovered. For financial institutions, the VAT treatment of SWIFT messaging services was clarified, especially around invoicing obligations and documentation for input tax recovery. The valuation of barter transactions was another key topic, covering how market value should be assessed and documented when no cash is exchanged. A practical interpretation of the tax treatment of bundled gold and making services was also shared, highlighting how composite and multiple supply rules apply in such cases.

The speakers also addressed changes around self-invoicing and reverse charge obligations for cross-border service recipients, and the core conditions for input tax recovery. This led into a practical segment on filing challenges—particularly with VAT registration and amendments—and how businesses can navigate common system issues. Attendees were guided through the reconsideration and penalty waiver processes, including eligibility, timelines, and documentation best practices. Finally, recent technical amendments were discussed, such as recognizing errors in tax treatment as a valid basis for output tax correction, and the authority of the FTA to offset recoverable tax against outstanding penalties.

Throughout the session, the emphasis remained on making complex policy shifts understandable and actionable. The event provided tax and finance professionals with the clarity needed to manage compliance today while preparing for the changes ahead.