Answers to all your questions on Transitional Provisions in the UAE - FAQs

Do I have to pay tax for supplies of goods and services that were paid for before UAE VAT came into effect?

If the supply of goods and services takes place on or after January 1, 2018, you have to collect and remit VAT for the transaction, irrespective of the date of payment for the supply.

If I was paid for goods before VAT but the supply will take place after VAT, do I need to issue a new invoice?

If you issued an invoice before the VAT implementation date of January 1, 2018, and the actual supply of the product takes place after the implementation date, then you will have to issue an additional invoice showing the tax charged on the transaction.

What is the VAT treatment on supplies made in instalments on or after January 1, 2018?

If a supply is made in instalments, with some instalments before the date of VAT implementation and some instalments after it, then the portions of the supply made after the date of implementation will be subject to VAT.

What are the transitional provisions for contractual agreements?

If a contract between two businesses concluded before January 1, 2018 and the goods are to be supplied after the implementation date, then in this situation, if the seller didn’t plan ahead and include VAT in their sale price, they’ll end up paying the VAT out of pocket and losing out on some of their expected profit.