Tax Invoice Requirements for Corporate Tax Purposes in UAE

A tax invoice can be defined as a written document that proves the occurrence of taxable supplies and their details. An original copy of this invoice is delivered by the registrar to the recipient and the registrar can keep the invoice in the event that there is no recipient. In this article we will clarify all the details about tax Invoice requirements in UAE, in line with Federal Decree-Law No. (8) of 2017 on Value Added Tax. To effectively meet VAT and tax requirements and ensure compliance with VAT and tax regulations, Taxable Persons are advised to seek the expert services of reputable Corporate Tax UAE.

Tax Invoice Requirements

The tax invoice must include all the data mentioned below:

• There must be the phrase “tax invoice” indicated on the invoice.
• The name and address of the registrant who made the supply and the tax registration number (TRN)
• The name and address of the recipient or recipient, and his or her TRN, if registered.
• The serial number of the tax invoice or a special number by which the tax invoice can be identified and arranged from among a group of invoices.
• The date on which the tax invoice was issued.
• The date of supply in the event that it is different from the date of issuance of the tax invoice.
• Description of the goods and services supplied.
• The price of each unit of service or goods, in addition to the quantity and volume supplied, the tax rate, and the amount payable in UAE dirhams.
• The value of the discount, if offered.
• The total amount is payable in AED.
• The amount of tax payable in dirhams and the exchange rate applied in the case where the currency is converted from a currency other than the UAE dirham.
• In the case where the invoice is related to a supply, the recipient or recipient must calculate the tax according to the invoice, as this must be mentioned in the invoice with reference to the relevant article in the decree law.

Difference Between Simplified Tax Invoice and E-Tax Invoice Requirements

We differentiate between the simplified invoice and the electronic invoice depending on the data and requirements for each one.

Simplified Tax Invoice Requirements

• There must be the phrase “tax invoice” indicated on the invoice.
• The name and address of the registrant who made the supply and his TRN
• The date on which the tax invoice was issued.
• A description of the goods and services supplied
• The total consideration and the amount of tax charged

Simplified Tax Invoice Issuance Cases

• The situation where the recipient is not tax registered (individual)
• In the case where the recipient is tax registered and the consideration does not exceed ten thousand UAE dirhams.

E-Tax Invoice Requirements

• The taxable person must have the ability to store a copy of the E-invoice securely in accordance with the requirements for record keeping.
• The authenticity and content of the source of this electronic invoice must be guaranteed.

The registrant does not issue tax invoices, and this procedure is legal for the case in which the registrant supplies more than one good or service to one person, as in this case a summary of a tax invoice is issued for the benefit of the recipient or recipient, and therefore there is no need to issue an invoice for each supply he did it according to this situation.

The Federal Tax Authority may also, if there are sufficient data and records to prove the supply or any category of supplies, decide the following according to the conditions it deems necessary:

• Failure to stipulate the necessary data for the tax invoice and the simplified tax invoice.

There is no need to issue a tax invoice in certain cases determined by the Federal Tax Authority (FTA)

Criteria for Determining Related Parties and Control in UAE Corporate Tax

Cases Where a Tax Invoice can be Issued on Behalf of the Supplier

This is possible in the case where the supplier and the recipient agree that the latter will issue a tax invoice on behalf of the supplier, and this written document is treated as if it was issued by the supplier according to the following conditions:

• The recipient must be tax registered.
• There must be a written agreement between them that the supplier will not issue the tax invoice in relation to the supplies that have been agreed upon.
• The tax invoice must contain all the data necessary as a tax invoice.
• The phrase “The tax invoice was prepared by the buyer” must be added clearly to the tax invoice

Therefore, the issuance of the invoice by the supplier in the aforementioned case and for the supply that was agreed upon cannot be considered a tax invoice.

If the agent supplies goods or services, the agent may also issue the tax invoice by proxy on behalf of his tax-registered client and for his benefit, provided that the tax invoice is not issued by the principal.

Tax Invoice Issuance Date

Pursuant to Federal Decree Law of 2022 amending some provisions of the VAT Law, Article (67) of this Decree Law specifies the date of issuance of the tax invoice within (14) days from the date of supply stipulated in Article (25) or Article (26) of this law, i.e., texts related to the date of supply and the date of supply in special cases.

Contrary to what was the case under the provisions of Federal Decree-Law of 2017, the new amendment to the law included a paragraph according to which there could be a period other than the aforementioned period, in cases where the invoice must be issued immediately.

The Currency Used in the Tax Invoice

The amount stipulated in the tax invoice is converted into the UAE dirham based on the exchange rate approved by the Central Bank in the country on the date of supply in cases where the supply was made in a currency other than the UAE dirham for the tax invoice.

Seek the expert services of VAT Registration UAE

To effectively meet VAT requirements and ensure compliance with VAT regulations, Taxable Persons are advised to seek the expert services of reputable corporate tax UAE consultants. VAT Registration UAE is a trusted Tax Consultant that assists Taxable Persons to meet VAT requirements in compliance with the statutory statutes. Thus, contact us today and we shall be glad to assist you.