How to Apply for a VAT Refund in the UAE

How to Apply for a VAT Refund in the UAE: Step-by-Step Guide

Value Added Tax (VAT) is a consumption tax charged at a standard rate of 5 percent on most goods and services in the United Arab Emirates. The government offers a refund for specific groups to claim back VAT on qualifying expenses to reduce the unnecessary tax burden. So, in this blog, we will show you who can claim a refund, what expenses qualify, and how to apply.

What is a VAT Refund?

A VAT refund allows a taxable person to recover excess input VAT when the input tax paid on business expenses exceeds the output VAT collected on sales. In other words, if your business pays more VAT on purchases than it charges on sales, you may submit a refund request to the Federal Tax Authority (FTA) for the excess amount.

Who Can Claim a VAT Refund in the UAE?

The UAE government has listed three main groups eligible for VAT refunds. 

1. Foreign Businesses
   Foreign businesses with no office, fixed address, or VAT registration in the UAE may claim a refund on VAT paid for eligible business expenses made within the country.
2. UAE Nationals Building New Residences
   UAE nationals who construct a new residential building for personal use can reclaim VAT paid on approved construction materials and contractor services.

3. Tourists Visiting the UAE
   Tourists leaving the UAE can request a VAT refund on eligible personal purchases made at participating VAT-registered shops. The refund is processed at airport counters or kiosks during departure.

   UAE VAT Refund Schemes

   Scheme	Eligible Group	Purpose
   VAT Refund for Foreign Businesses	Non-UAE companies	To recover VAT paid on eligible business expenses within the UAE
   VAT Refund for UAE Nationals Building Homes	Emirati citizens	To reclaim VAT paid on approved construction materials and services
   Tourist Tax Refund Scheme	Tourists visiting the UAE	To promote tourism by refunding VAT on eligible shopping

   1. VAT Refund for Foreign Businesses

   Foreign companies that are not established in the UAE but incur expenses locally for business purposes may claim a refund of the VAT paid. This scheme was introduced to avoid double taxation, promote international trade, and support cross-border business activity.

Who Is Eligible to Claim?

Your business may apply for a VAT refund under this scheme if:

1. It has no fixed establishment, office, or business presence in the UAE
2. It does not regularly make taxable supplies within the UAE
3. The total refund amount exceeds AED 2,000

4. You submit only one claim per 12-month period

   Eligible Expenses Include:

• Hotel accommodation and lodging expenses
• Local transportation services
• Business event or exhibition fees
• Legal, audit, or professional service charges
• Other business-related costs supported by valid UAE tax invoices

How to Claim VAT Refund for Foreign Businesses:

Step 1: Log in to the FTA e-Services Portal

Go to eservices.tax.gov.ae and log in with your username and password.

Step 2: Access the VAT311 Refund Form

After logging in, navigate to the “VAT” tab → click “VAT Refunds” → then select “VAT311 – New Tax Refund” to open the form.

Step 3: Complete the Refund Form

Fill in all required fields. Some details, such as your TRN, entity name, and total excess refundable tax, will be auto-filled based on your VAT returns.

You must also enter the refund amount you wish to claim — this cannot exceed the available refundable balance after any applicable penalties are deducted.

Step 4: Attach the Required Documents

Upload a bank account validation letter issued and stamped by your bank. This document must include:

• Your business name (must match the name registered with the FTA)
• Bank name and address
• SWIFT/BIC code
• IBAN number

Note: If your bank is based outside the UAE and does not have a local correspondent bank, refund payments may take longer and could incur transfer fees.

Step 5: Submit the Refund Form

After reviewing your entries, click the Submit button. Make sure your declaration is ticked to confirm agreement to provide supporting evidence and repay incorrect claims if necessary.

Step 6: Wait for Review and Refund

The FTA will review your application within 20 business days. If approved, the refund amount will be transferred to your bank account within 5 business days after approval. You’ll be notified by email once processing is complete.

Step 7: Verify Refund Status

To confirm the payment, go to the “My Payment” tab under “Transaction History” in your portal dashboard. The refunded amount will appear once processed.

2. VAT Refund for UAE Nationals Building New Homes

UAE nationals who build a new residential property for personal use can claim a refund on the VAT paid for eligible construction expenses. This scheme helps reduce the cost of homebuilding and supports citizens in owning private residences. 

Who Can Claim?

The refund applies only if:

• The applicant holds UAE nationality
• The building is newly constructed and used as a personal residence
• The claim is submitted within 12 months of completion, based on the earlier of:
  • The date the building is first occupied
  • The date the completion certificate is issued

What Can You Claim?

You can claim VAT paid on key construction expenses, including:

• Contractor services (engineering, construction, plumbing, etc.)
• Building materials permanently fixed to the property

The FTA has listed examples of eligible items:

• Central air conditioning units
• Window frames and glazing
• Floor tiles and wooden flooring (excluding carpets)
• Sanitary fittings, sinks, and shower units
• Internal wiring and fire alarm systems
• Kitchen cabinets and fixed worktops

Steps to Claim VAT Refund for Construction of New Building

Step 1: Prepare Your Documents

Gather all valid tax invoices and documents related to construction expenses. Ensure the following:

• The invoices clearly show your name as the owner
• Each supplier’s TRN is included
• Expenses are for materials or services permanently fixed to the property

Step 2: Download the Refund Form

Visit the FTA website and download the VAT refund form titled: “VAT Refund Form for UAE Nationals Building New Residences.

Step 3: Fill Out the Refund Form

Provide:

• Your personal details (including Emirates ID/passport)
• Property ownership documents
• Breakdown of expenses with attached invoice copies
  Make sure to include only eligible items, such as:
• Contractor services (construction, plumbing, electrical)
• Fixed materials (tiles, built-in cabinets, sanitary fittings)
• Wiring, fire alarm systems, and HVAC equipment

Step 4: Submit the Form to the FTA

Send the completed form and all attachments as per instructions on the form. You do not need to create an FTA e-Services account for this claim. Submission can be done physically or through the listed communication channels.

Step 5: Await FTA Review and Refund

The FTA will review your application and notify you of the decision. If the claim is approved, the refund amount will be transferred to your bank account within 5 working days after approval.

3. VAT Refund for Tourists Visiting UAE

Tourists who shop in the UAE can get a refund on a portion of the VAT paid for eligible purchases. This scheme boosts tourism by offering a simple way to claim back tax on goods bought for personal use.

The system works through approved retailers and airport refund counters or kiosks. The refund covers up to 85% of the VAT amount, after a small processing fee. Tourists must validate their purchases before departure and complete the process within the allowed time.

Who Can Claim?

To qualify for a VAT refund, the tourist must:

• Shop at outlets registered under the official Tax Refund for Tourists scheme
• Spend at least AED 250 in a single transaction
• Complete validation within 90 days from the purchase date
• Leave the UAE within 6 hours of validating the purchase

What Can You Claim?

Tourists can reclaim VAT on goods purchased for personal use. The following items are not eligible:

• Goods consumed or used within the UAE
• Services (e.g., hotel stays, transport, meals)
• Items that are not carried out of the country

The refund applies only to physical goods that leave the UAE with the tourist.

Steps to Claim VAT Refund for Tourists in UAE

Step 1: Shop at a Registered Store

Make sure you buy from a retailer that is part of the official Tax Refund for Tourists Scheme. At the time of purchase:

• Present your passport to the cashier
• Ask the store to issue a tax-free invoice
• The store will scan your passport and create a digital tax invoice tagged to your identity

Step 2: Keep the Invoice and Tag

The store will give you a digital invoice or a QR code. This tag will link your purchase to your passport. You must keep this information safe, as it will be required at the airport.

Step 3: Validate Your Purchases at the Airport

Before you check in, go to a Planet tax refund kiosk or validation counter located inside the airport.

• Scan your passport and invoice
• Show the items you purchased, if asked
• The system will verify the eligibility of your purchase and complete the validation
  This process must be done within 90 days of the invoice date. You must leave the UAE within 6 hours after validating your claim.

Step 4: Choose a Refund Method

Once your purchase is validated, you will be asked to choose how you want to receive the refund. You can select:

• Cash, if the amount is within the airport’s limit
• Credit card or digital wallet, such as WeChat Pay or Alipay

Step 5: Receive the VAT Refund

• If you choose a digital method, the refund will be processed within 9 days
• If you select cash, you can collect it immediately at the airport
• The system will deduct a small processing fee, and you will receive up to 85% of the VAT amount

FAQ

1. What is the standard VAT rate in the UAE?

The standard VAT rate in the UAE is 5%.

2. Who can apply for a VAT refund?

The UAE allows VAT refunds for three main groups:

• Foreign businesses with no base in the UAE
• UAE nationals building new homes
• Tourists shopping in the UAE and taking goods out of the country

3.Which expenses qualify for a VAT refund?

Refundable expenses depend on who applies. Tourists can claim VAT on personal goods. UAE nationals can claim on home construction items. Foreign firms can recover VAT on business-related spending inside the UAE.

4. What documents should I submit to claim a VAT refund?

• Valid tax invoices
• Completed VAT311 – New Tax Refund form
• Emirates ID or passport copy
• For businesses: commercial license or certificate of incorporation
• Stamped bank validation letter including IBAN, SWIFT/BIC, and account holder name matching FTA record

5.When will I get the VAT refund?

The Federal Tax Authority usually reviews refund claims within 20 working days. If approved, the refund reaches the applicant’s bank account in the next 5 working days.