FTA Public Clarification on Excise Tax- Deregistration of Stockpilers (update Feb 2020)

UAE Excise Update – February 2020

UAE Federal Tax Authority has recently published public clarification on “Deregistration of Stockpilers” (Excise Tax Public clarification – EXTP004). Below are the highlights of the FTA Public Clarification.

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As per Article 7(1) of Executive Regulations on Excise Tax Law, there are certain cases, in which FTA may reject Excise Tax Deregistration application. And, one of those reasons is: “If less than six months have passed since the person was registered for Excise Tax.”

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This Public clarification discusses the circumstances in which Stockpilers may be allowed to deregister before six months have elapsed since their effective date of registration

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Conditions that must be met before submitting a deregistration application:

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The registered person has met all his tax obligations including filing of declarations, submission of tax returns and payment of all due tax

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The registered person does not conduct or has no intention to conduct any of the excisable activities in the future i.e.

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Production of Excise Goods

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Importation of Excise Goods

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Release of excise goods from a Designated Zone

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Documents which may be requested by FTA to validate the deregistration application:

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A copy of their audited records, showing the quantity of stock of excise goods on the date the liability to account for Excise Tax on those goods arose;

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Records of the quantity of stock and sales of excise goods for the 12 months prior to that date

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A copy of the calculations prepared to determine whether the Person held excess excise goods on the date the liability to account for Excise Tax on those goods arose;

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Evidence that supports that Excise Tax has been paid on the excess excise goods

FTA may ask for further documents as well and will consider each deregistration application on a case-to-case basis.

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Article compiled by: Mr. NAIMABBAS A VIRANI and BHAWNA CHOPRA

This document is only for information purposes and should not be construed as advice. It does not necessarily cover each aspect of the topic with which it deals. You should not act upon the contents of this document without receiving formal advice on your particular circumstances.

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