Importation of Goods by Agents on Behalf of VAT Registered Persons

Highlights of the FTA clarification:

1
This clarification covers the cases where a VAT registered agent to import goods on behalf of the owner of the goods who is also VAT registered. In such cases, since the importing agent would have given their own TRN at the time of import, the VAT amount would have been auto-populated in Box 6 (Goods imported into the UAE)

2
The clarification discusses the adjustments that should be made in the VAT returns of the importing agent on one hand and the owner of the goods on the other hand.

3.
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Option 1
The importing agent and owner both make an adjustment in Box 7 (Adjustments to goods imported into UAE). Importing agent makes a negative adjustment to nullify the amount of auto-populated Box 6 figure in the VAT return. Owner of the goods makes a positive adjustment in Box 7 to include the value of the goods imported on its behalf by the importing agent. And, the owner would be entitled to recover the import VAT (declared in Box 7) in Box 10 as per its normal VAT recovery position.

Under this option, the importing agent and owner need to have written an agreement to make these adjustments and must retain this agreement along with customs documentation.

3.
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Option 2
The importing agent issues a statement to the owner compliant with Article 50(7) of the UAE VAT executive regulations, which will be considered as a Tax invoice allowing the owner to recover Input tax in Box 9 (Standard rated expenses) of the VAT return

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