One of the taxes imposed on businesses in the UAE is the excise tax, which is applied to specific goods such as tobacco, sugary drinks, and energy drinks. Excise tax is levied at a standard rate of 50% on tobacco products and 100% on energy drinks and soft drinks containing sugar. However, businesses that import or manufacture excise goods in the UAE are eligible for refunds on the excise tax UAE they pay. This article seeks to discuss the different types of refunds available for excise tax in the UAE. Thus, it is advisable for taxable persons to seek the services of top tax consultants in UAE to seamlessly avail of excise tax refunds and to stay compliant with tax standards.
Refunds on Excise Tax Paid on Imports
One of the most common types of refunds available for excise tax in the UAE is for businesses that import excise goods. When businesses import excise goods, they are required to pay excise tax at the point of entry into the UAE. However, businesses can claim a refund of the excise tax paid on imported goods if they meet certain conditions. To be eligible for a refund, the imported goods must have been re-exported or destroyed. If the goods are re-exported, the refund will be granted if the re-exportation is completed within 90 days of the import. Additionally, businesses must provide the necessary documentation to prove that the goods have been re-exported or destroyed. The documentation must include the import declaration, the export declaration, and any other relevant documents.
Refunds on Excise Tax Paid on Manufactured Goods
Another type of refund available for excise tax UAE is for businesses that manufacture excise goods in the country. When businesses manufacture excise goods, they are required to pay excise tax on the production of the goods. However, businesses can claim a refund of the excise tax paid on the manufactured goods if they meet certain conditions. To be eligible for a refund, the manufactured goods must have been exported or destroyed. If the goods are exported, a refund will be granted if the exportation is completed within 90 days of the production. Additionally, businesses must provide the necessary documentation to prove that the goods have been exported or destroyed. The documentation must include the production declaration, the export declaration, and any other relevant documents.
Refunds on Excise Tax Paid on Stockpiled Goods
Businesses in the UAE may also be eligible for a refund of the excise tax UAE paid on stockpiled goods. Stockpiled goods are excise goods that have been produced or imported but have not yet been sold or used. In such cases, businesses can claim a refund of the excise tax paid on the stockpiled goods if they meet certain conditions. To be eligible for a refund, the stockpiled goods must be destroyed. Additionally, businesses must provide the necessary documentation to prove that the goods have been destroyed. The documentation must include the production or import declaration, the destruction certificate, and any other relevant documents.
Refunds on Excise Tax UAE Paid on Goods Destroyed Due to Natural Disasters
In the event of a natural disaster such as a flood, fire, or earthquake, businesses in the UAE may be eligible for a refund of excise tax paid on goods that have been destroyed. To be eligible for a refund, the goods must have been destroyed as a result of the natural disaster. Additionally, businesses must provide the necessary documentation to prove that the goods have been destroyed due to the natural disaster. To claim the refund, businesses must provide the following documents to the FTA:
- Declaration form for damaged or destroyed goods
- Proof of payment of excise tax
- Customs declaration for the goods
- Supporting documents, such as a police report or insurance claim
Read More: Differences between Excise Tax & VAT in UAE
Tax-Free Scheme Refund
A tax-free scheme refund is available for excise tax paid on goods that are sold to diplomats or members of armed forces stationed in the UAE. To claim the tax-free scheme refund, the following conditions must be met:
- The goods must be sold to diplomats or members of the armed forces stationed in the UAE.
- The goods must be subject to excise tax.
- The supplier must provide evidence that the goods have been sold to a diplomat or a member of the armed forces stationed in the UAE.
Seek the Services of Top UAE Tax Consultants
Conclusively, the UAE offers various types of refunds on the excise tax, including refunds on the importation, damaged or destroyed goods, goods sold to diplomats, and goods sold to tourists. The eligibility criteria for each type of refund may vary, and businesses must provide the required documentation to the FTA to claim the refund. Thus, it is advisable for taxable persons to seek the services of tax consultants in UAE to seamlessly avail excise tax refund and to stay compliant to tax standards. Therefore, contact us today and we shall be glad to assist you.
