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Frequently Asked Questions on VAT

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What is the domestic reverse charge mechanism and how is it different from normal reverse charge?

Under the domestic reverse charge mechanism in the UAE, the supplier shall not charge VAT on the goods and services, even if their business is VAT registered. The recipient of the goods is liable to account for the supplies and pay any tax due as per the tax obligations set by the tax authority.

The only difference between domestic reverse charge and normal reverse charge is that under domestic reverse charge, the goods are being exchanged within the same country, whereas normal reverse charge is applicable on imports of goods and services from outside the UAE.

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