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Frequently Asked Questions on VAT

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What is the place of supply and VAT treatment for goods supplied in the Designated Zone?

If the goods are supplied within a Designated Zone, then the place of supply is considered to be ‘offshore’ or outside of the UAE. Therefore, the goods supplied will not be subject to VAT. 

In most cases, the authorities expect a written declaration from the buyer that the purchased goods will not be used for purposes that will make the sale fall under the purview of VAT. 

If the goods are supplied to a person who will be consuming them, then the place of supply will be the UAE and VAT will be applicable under normal rules. 

If a person purchases the goods with an intention to resell or manufacture any other product using these goods as the main component, then the supply will not be subject to VAT. 

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