By Karun Reji, Chartered Accountant, BI-Outsource. General information, not tax or legal advice. Rules change: check the current position before you act.
Short answer: if your input VAT is higher than your output VAT, the excess is carried forward as a credit. You can apply to the FTA for a refund of that credit on EmaraTax. Exporters and businesses with large capital purchases often have refunds. Clean records, valid tax invoices and a reconciled VAT return are what get refunds approved.
When a refund arises
- Exporters whose sales are zero-rated but who pay 5% on purchases.
- Businesses with large capital purchases in a period.
- Start-ups with expenses before revenue.
- Businesses that overpaid VAT in an earlier return.
How to claim
- File the VAT return showing the excess recoverable tax.
- Submit the refund request on EmaraTax.
- Upload supporting schedules: purchase and sales listings and key tax invoices.
- Respond quickly to any FTA query.
- Receive the refund to the registered bank account once approved.
| Common rejection reason | Fix |
|---|---|
| Invoices missing supplier TRN or required details | Get corrected tax invoices |
| Input VAT claimed on blocked items (e.g. entertainment) | Remove before filing |
| Export evidence missing | Keep customs and shipping documents |
| Bank account not validated | Update and verify bank details |
Time limits
Refund claims are subject to time limits set by law, recently aligned to a five-year window. Do not let credits sit for years: claim when they become material.
Need help? We prepare VAT returns and refund files. See accounting services in the UAE.
Frequently asked questions
The FTA aims to review within a set number of business days, but queries extend this. Complete documents speed it up.
Yes, the excess is carried forward automatically if you do not request a refund.
No, tourist refunds use a separate scheme at points of exit.
Yes, a separate scheme exists for new residences built by UAE nationals.
