Every taxable person is gearing up to comply with all the Excise rules and procedures. Besides registration, returns, and payments, Excise tax refund in Dubai/UAE is also an important aspect to be addressed.

What is refundable tax?

Amounts that have been paid and the Authority may return to the person pursuant to the provisions of the Decree Law on Excise.

What is deductible tax?

The deductible tax consists of the following:

a. The tax paid on excise goods which have been exported;

b. The tax paid on excise goods which have become a component of another excise good which is, or will become, subject to tax; eg. If an importer has paid AED 10 as excise tax on raw tobacco which is used in the manufacture of cigarettes of AED 100 for which excise tax is AED 100, AED 10 would be considered as a deductible tax.

c. Amounts paid to the authority in error.

2. The Executive Regulation of this Decree-Law shall specify the conditions and controls for deducting the Tax mentioned in clause (1) of this Article

How to Get Excise Tax Refund in Dubai/UAE?

The taxable person shall carry forward any excess refundable tax to the subsequent tax periods and offset such excess against the payable tax or any administrative penalties imposed under this Decree Law or Federal Law No. (7) of 2017 on Tax Procedures in subsequent tax periods until full depletion of such excess, in the following cases:

a. If the taxable person’s deductible tax exceeds the due tax for the same tax period; For eg. If the taxable person exports excisable goods, on which the deductible tax was AED 100, and the tax due for the tax period was AED 50, he is entitled for a refund of AED 50.
b. If the tax paid to the authority by the taxable person exceeds the payable tax according to the provisions of this Decree-Law.

If any excess remains for any tax period after being carried forward for a period of time, the taxable person may submit an application to the authority for a refund of the remaining excess, in accordance with the timeframes and procedures specified by the Executive Regulation of this Decree-Law.

What are the special cases for Excise tax refunds in Dubai/U.A.E?

The authority may refund the tax based on a refund application submitted thereto to the following:

1. Foreign governments, international organisations and diplomatic bodies and missions, on condition of reciprocity, for tax paid in the course of their official activities and in accordance with the conditions, controls and procedures specified in the Executive Regulation of this Decree-Law.

2. The person who is registered in any implementing state should he pay the due tax in the state and then export the excise goods to an implementing state in accordance with the conditions, controls and procedures specified in the Executive Regulation of this Decree-Law.

3. Any other Persons or categories determined by a Cabinet Decision at the suggestion of the Minister.

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