Visitors to the United Arab Emirates can now reap the benefits of tax-free shopping, claiming refunds on Value Added Tax (VAT) paid on eligible purchases during their visit. The process is facilitated through a streamlined electronic system linking participating retailers with various ports of entry and exit throughout the UAE.
Understanding Tax-Free Shopping in the UAE
Since the introduction of a 5% VAT by the Federal Tax Authority (FTA) in January 2018, tourists have been able to take advantage of a fully digital tax refund service. This initiative was launched to enhance visitor experience, enabling tourists to reclaim VAT on items purchased for export, following specific terms and conditions.
To be eligible for a VAT refund, tourists must validate their purchases at the point of exit. Refund requests can be made up to one year from the date of export validation.
How the VAT Refund System Works
Planet is the exclusive operator of the VAT refund system for tourists, allowing travelers to secure refunds when departing by land, sea, or air. Many major retailers are registered under this scheme.
Steps for Tax-Free Shopping
- In-Store Request: Tourists must ask for a tax-free purchase, applicable for a minimum spend of AED 250.
- Validation of Identity: A valid travel document needs to be scanned at the point of sale.
- Information Capture: The retailer uses the Planet system to input the tourist’s details.
- Issuance of Tax-Free Tags: A ‘tax-free’ tag is affixed to the back of the sales receipt.
- Creation of Digital Form: This form is generated to facilitate the refund process.
- Validation at Departure: Tourists must validate their transactions within 90 days at the airport.
Conditions for VAT Refund Eligibility
Refund requests have certain restrictions, including:
- VAT cannot be claimed on items consumed within the UAE.
- Goods must be in the tourist’s possession while exiting the country.
Additionally, to qualify for a refund, tourists must meet the following criteria:
- Be at least 18 years of age.
- Purchase goods from retailers participating in the VAT refund scheme.
- Ensure the goods are not on the FTA’s exclusion list.
- Physically present the tax invoice, ‘tax-free’ tags, and goods at the time of exit.
Collecting Your VAT Refund
To receive VAT refunds, tourists can utilize dedicated devices available at departure points such as airports and seaports.
The required documents for submission include:
- Tax invoices from participating outlets.
- A copy of the passport.
- A copy of the credit card used for the purchase.
Upon submitting these documents, travelers can opt for refunds in cash or as a credit back to their card. It’s important to note that tourists will receive 85% of the total VAT amount after a nominal fee of AED 4.80 per tax-free tag is deducted.
Additional Resources
For comprehensive details about tax-free shopping regulations, eligibility, and processes, refer to the Guide to Tax-Free Shopping (PDF).
Useful Links
These resources will help ensure that you make the most of your shopping experience during your visit to the UAE.
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