NOT IN FORCE. Please be informed that Public Clarification VATP031 has been replaced with Public Clarification VATP037.
Article 3 of the Cabinet Decision No. 52 of 2017 on the Executive Regulation of the Federal Decree-Law No. 8 of 2017 on Value Added Tax ("Executive Regulation") has been amended by Cabinet decision No. 99 of 2022, which introduced a new provision.
Article 3(2) of the amended Executive Regulation states that the functions of a member of a Board of Directors (hereafter referred to as "Director"), performed by a natural person, appointed as Director, for any Government entity or private sector establishment, shall not be considered as a supply of services.
The new provision takes effect as from 01 January 2023.
This Public Clarification provides guidance on how to apply the new provision and determine the resulting VAT obligations prior and post the date of 01 January 2023 on concerned natural persons.
With effect from 01 January 2023, the performance of a Director's function, by a natural person and for a remuneration (mon...