VAT Return Filing and Refunds in the UAE

Every VAT-registered business in the UAE must file a VAT return with the Federal Tax Authority for each tax period, monthly or quarterly as assigned by the FTA, and pay any VAT due within 28 days of the period end. Dawn Consultancy prepares and files VAT returns, reconciles them to the accounting records, recovers refunds where input VAT exceeds output VAT, and handles voluntary disclosures, deregistration and FTA audits. This page covers the compliance cycle after registration; for registration itself see our VAT registration service.

The VAT return

The return (Form VAT201) reports standard-rated supplies by emirate, zero-rated and exempt supplies, reverse-charge purchases, imports through customs, and recoverable input VAT. Common errors that trigger penalties include reporting sales in the wrong emirate, recovering VAT on blocked expenses (entertainment, personal vehicles), missing the reverse charge on imported services, and recovering input VAT without a valid tax invoice.

Our VAT compliance service

• Monthly or quarterly return preparation from your accounting system or records
• Reconciliation of output VAT to sales ledgers and input VAT to purchase invoices before filing
• Review of tax invoices for compliance with FTA requirements
• Reverse-charge and import VAT treatment, including customs-linked import declarations
• Designated zone and free zone supply analysis
• Filing on EmaraTax and payment scheduling
• Refund applications (Form VAT311) for businesses in a repayable position, with supporting documentation packs
• Voluntary disclosures (Form VAT211) to correct prior returns
• VAT deregistration when turnover falls below the threshold or the business closes
• FTA audit support and penalty reconsideration requests

Deadlines and penalties

• Return and payment: 28 days after the end of the tax period
• Late return: AED 1,000 for the first offence, AED 2,000 for a repeat within 24 months
• Late payment: 2% of the unpaid tax immediately, then 4% per month up to 300%
• Incorrect return: fixed penalty plus a percentage of the tax difference, reduced where corrected by voluntary disclosure
• Deregistration: application within 20 business days of becoming eligible; late deregistration penalty AED 1,000 per month up to AED 10,000

VAT refunds

Businesses whose input VAT regularly exceeds output VAT, typically exporters, zero-rated suppliers and companies in a start-up or capital-expenditure phase, can claim a refund of the excess. The FTA reviews refund claims closely and usually requests the largest supporting invoices, bank evidence of payment and, for exports, customs and shipping documents. We assemble the claim so that it is approved first time; a rejected claim delays the refund by months.

Frequently asked questions

My business made no sales this quarter. Do I still file?
Yes. A nil return must be filed for every tax period while the registration is active.

Can I recover VAT on staff entertainment or a company car?
Not on entertainment provided to non-employees, and not on vehicles available for personal use. These are blocked input VAT categories.

How long does a VAT refund take?
The FTA aims to process refund applications within 20 business days, but requests for documents extend this. Complete claims are paid faster.

I found an error in a return I filed last year. What should I do?
File a voluntary disclosure within 20 business days of discovering the error. Penalties are significantly lower than if the FTA finds it.

I am closing my company. When do I deregister for VAT?
Within 20 business days of ceasing taxable supplies. The final return must be filed and any VAT paid before the licence can be cancelled.

Get your VAT returns handled

Email info@dawnconsultancy.com, call +971 55 441 1036, or request a call back. Related: Corporate Tax services and company liquidation.