In practice, UAE VAT taxpayers may receive Tax Invoices with a delay, sometimes months or even a year after the underlying supply was made. In such situations, the VAT return for the original tax period may already have been filed without including the input VAT related to that invoice.
This raises a common compliance question: can the taxpayer claim the input VAT deduction in a later tax period once the Tax Invoice is received, and if so, what is the maximum time limit for exercising this right?
Understanding the difference between the right to recover input VAT, the carry-forward of excess recoverable tax, and document retention obligations is essential to avoid losing the right to deduction.
Federal Decree-Law No. 8 of 2017 on Value Added Tax
Article 55 (Recovery of Input Tax)
Article 74 (Excess Recoverable Tax)
Key principle:
The right to recover input VAT arises when the taxpayer holds a valid Tax Invoice and the expense is used for making taxable supplies. The deduction must be claimed within the statutory time limit established by the VAT law, regardless...