How to Claim UAE Excise Tax Refunds in Special Cases

For excise tax purposes, Cabinet Decision No. 37/2017 specifies that some taxpayers can get refunds in special instances. Four types of taxpayers fall under the exceptional cases category:

1. Governments and groups from other countries: If a foreign government, diplomatic mission, or international organisation buys excise goods for official use, they can get their money back if their home country has a tax treaty with the US.

2. Firms registered in the GCC: These are firms that are registered in another Gulf Cooperation Council (GCC) country and paid excise duty in the UAE before sending their goods back to their home country, where they had to pay the same taxes.

3. People who don’t have to pay excise tax on products they export directly from a UAE-registered company that has already paid the tax.

4. Destruction or Irreversible Loss: Businesses that destroyed excise products (like expired inventory) or lost them due to circumstances they couldn’t control.

Step-by-Step Refund Process for Special Cases

1. Make sure you qualify and collect all necessary documents. Before filing a claim, small and medium-sized businesses must:
   1. Make sure they belong to one of the four specific groupings.
   2. Get proof of export or destruction, tax certificates, corporate invoices, and customs declarations. People from the GCC who want to claim must present evidence that they paid taxes in both places
2. Sending it through the FTA Portal. All requests for compensation are filed using the FTA’s e-Services portal:
   1. Sign in with the exact details you used to register.
   2. Select the Excise Tax tab, then choose “Refunds for Excise Tax.”
   3. Fill out Form EX301 with the tax year, the amount of the refund, and the cause for it.
   4. Send in any paperwork that is required.

3. Look over the FTA and check it. The FTA has 20 business days to look over the claims.
   1. During this time, it may conduct audits to verify that the reported items align with customs records.
   2. Ensure that the paperwork for taxes on exports is accurate and complete.
   3. Following GCC agreements that let citizens from other countries make claims.
   4. Refunds are sent out within 21 days of the audit being done or 2 months after they are authorised.

Common Mistakes and Best Practices for Special Case Refund.

Paperwork Errors

Missing or confusing paperwork is the most prevalent reason why claims are denied. Auditors should maintain digital copies of all transactions for at least five years and utilise inventory systems based on blockchain to track items from receipt to disposal or destruction.

Not knowing about GCC reciprocity

When SMEs sell goods to GCC countries, they usually don’t consider the different rates of excise duty. For example, Saudi Arabia imposes a 100% tax on energy drinks, while the UAE applies a 50% tax. Auditors must compare bilateral agreements to ensure that there are no duplicate taxes or disagreements regarding refunds.

Keeping track of cash flow and time

Refunds might take up to 60 days, so small and medium-sized businesses should plan for delays in their financial predictions. Use the FTA’s extra refundable tax offset mechanism. This lets you take money you owe now off of what you owe in the future.

Consult Top Tax Experts in the UAE for Professional Guidance

To ensure full compliance with excise tax laws in UAE, businesses should consult premier Tax Consultants in the UAE. Contact us today—we’re here to help.