Tax & compliance
VAT returns, deadlines and payment
Quarterly for most, monthly above a turnover threshold, and due within twenty-eight days of the period end. The return and the payment are separate obligations with separate penalties.
The rule
What the law actually requires.
A registered business files a VAT return for each tax period, reporting output VAT charged on sales and input VAT incurred on purchases, and pays the difference or claims the excess. Most businesses are assigned quarterly periods; those above a turnover threshold set by the FTA file monthly. The return and payment are due within twenty-eight days of the end of the tax period. Filing and payment are separate obligations, each with its own penalty, which means a business that cannot pay should still file.
Where returns go wrong is usually input VAT rather than output VAT. To recover input tax you need a valid tax invoice containing the specific particulars the law requires, the supply must be for business purposes, and certain categories — entertainment, and motor vehicles available for personal use — are blocked entirely. Businesses that claim input VAT on a supplier's proforma, on a handwritten receipt, or on staff entertainment are creating an adjustment that surfaces on audit, with a penalty attached. Recovering less and recovering it correctly is almost always the better position.
Thresholds and deadlines
- Frequency
- Quarterly for most; monthly above the FTA's turnover threshold
- Deadline
- 28 days from the end of the tax period
- Filing and payment
- Separate obligations with separate penalties
- Input VAT
- Requires a valid tax invoice with the prescribed particulars
- Blocked input
- Entertainment; motor vehicles available for personal use
- Refunds
- Excess input VAT can be reclaimed or carried forward
The compliance calendar
What to do
The filing, step by step.
- Confirm your tax periodAssigned by the FTA at registration. Assuming quarterly when you have been assigned monthly is an expensive assumption.
- Reconcile output VAT to the sales ledgerEvery taxable supply, at the right rate, in the right period.
- Check every input VAT claim against a valid tax invoicePrescribed particulars, supplier's TRN, correct date. No invoice, no claim.
- Exclude blocked categoriesEntertainment and personal-use vehicles are not recoverable, and claiming them is a common audit finding.
- File within twenty-eight days even if you cannot payFiling and payment penalties are separate, and filing stops one of them.
Related
Questions
Within twenty-eight days of the end of the tax period. Payment is due on the same date.
Quarterly for most registrants; monthly for businesses above the turnover threshold set by the FTA. Your period is assigned at registration.
File the return anyway. Late filing and late payment are separate penalties and filing prevents one of them.
No. Entertainment expenses are blocked from input recovery, as are motor vehicles available for personal use.
One question
Where are you with VAT?
The test is rolling rather than annual, which is why the obligation usually arises mid-year rather than at a year end. Above AED 375,000 of taxable supplies over any twelve months it is mandatory, and the thirty-day forward test can trigger it before you have invoiced anything.
The thresholds explainedOr just ask usThen the exposure is almost certainly input VAT rather than output. Claims without a valid tax invoice, entertainment, and personal-use vehicles are the three findings that come up on nearly every review, and the adjustment carries a penalty.
What gets disallowedOr just ask usDisclose it rather than hoping. The penalty on a voluntary disclosure is materially lower than on an error the FTA finds, and audits that uncover undisclosed errors tend to widen rather than close.
Voluntary disclosureOr just ask us