The FTA has issued a new guide detailing the procedure for claiming VAT refund on home construction. The guide provides for refund where a UAE national owns or acquires land in the UAE on which the person builds his/ her residence. Refund can be claimed only by a natural person who is a UAE national.
Expenses which can be claimed as refund are:
- Services provided by contractors, including services of builders, architects, engineers, and other similar services necessary for the successful construction of the residence.
- Building materials, being goods of a type normally incorporated by builders in a residential building or its site.
VAT on personal expenditure like furniture purchase or appliance purchase cannot be claimed.
Homeowners are required to file refund application form within six months from the date of completion of newly built residence.
Date of completion will be considered earliest of:
- the residence becomes occupied; or,
- when it is certified as completed by a competent authority in the UAE, as stipulated by the FTA.
Submitting the request for VAT refund on home construction is a four-step process which involves:
- Downloading: Download VAT refund form from the FTA website. The form will be printed, filled out and signed by the person claiming the refund
- Submission of documents: The signed form along with supporting documents like Emirates ID and ownership documents will be submitted in pdf format at [email protected]
- Confirmation: FTA will send an email confirmation on receiving documents. Another mail within five working days will be sent confirming whether an applicant is eligible for refund or not. The reference number will be issued by the FTA on approval.
- Submission of request: Eligible applicants will submit the request for the refund along with reference number and invoices to the verification body accredited by the FTA.
These authorities will send a report to the FTA within 15 days of receiving the refund application. The report will contain the amount of taxes paid versus the recoverable amount. List of authorities will be listed on the FTA website.
After receiving the report, FTA will take around 20 days to process the request and approximately another five days to refund the recoverable amount. No fee is charged by the FTA for claiming the refund under this scheme.
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