What Information Must be Included in Your Tax Invoice In UAE

Tax invoice is the quintessential record by a VAT registered individual to the recipient, while a taxable supply of goods or services is made. Executive regulation on VAT gives the necessary instructions for tax invoicing and when it should be issued. You need to understand what information must be included in your tax invoice in UAE like “Tax Invoice”, name of the supplier, tax registration number, address, overall amount, etc. Prior to getting in more details about the needs of a tax invoice in the UAE, know certain basic details regarding tax invoice, and other terms related to it. Here mentioned a complete guide that will definitely help you to understand all vital things.

What is Tax Invoice in UAE 

A tax invoice may be referred to as an electronic or written document issued by a registrar when taxable goods or services are done. According to the VAT law, this is compulsory for all the registrants to issue tax invoices for all types of taxable supplies made to other registrants if the consideration of such supplies exceeds AED 10,000.

Types of Tax Invoice in UAE

There are two types of tac invoices in UAE according to the FTA guidelines:

  • Simplified Tax Invoice 

This invoice is issued for supplies lower than the mentioned amount. This is issued when the customer is a retail buyer who doesn’t have a VAT number. This kind of invoice is for supermarkets and other retai8l industries who supply goods to end clients.

  • Detailed Tax Invoice 

This invoice is issued for supplies in excess of the mentioned amount. This is issued to the registrants who are allocated with the VAT number. These types of invoices are majorly for wholesalers and traders. An invoice is issued for goods or services supplied by a registered business to any other registered user.

What are the Key Contents of a Tax Invoice in UAE 

The key contents of tax invoice in UAE are categorized is depending on the detailed and simplified tax invoices are:

Detailed Tax Invoice 

  • The word “Tax Invoice” should be displayed at a notable place
  • The name, address, and the TRN number of the suppliers should be comprised.
  • The name, address. and the TRN number of the recipient should be involved
  • It should have a unique tax invoice number, which can be utilized to identify the tax invoice.
  • Tax invoice issued date
  • Date of supply if this is varying from the issuance date of invoice
  • Adequate description of the services or goods supplied
  • Chargeable amount per unit, applicable tax, quantity supplied in AED
  • Amount of exemption
  • Gross amount due
  • Amount of tax payable
  • Reverse charge statement

Simplified Tax Invoice

  • The word “Tax Invoice” should be displayed at a notable place
  • The name, address, and the TRN number of the suppliers should be involved.
  • Tax invoice issued date
  • Adequate description of the services or goods supplied
  • Overall amount to be payable for the supplies done
  • Overall tax charged on the supplies

According to the FTA guidelines, all supplies should adhere to the above content in the tax invoice in UAE. This must contain all the necessary information, if the registrants or the suppliers don’t adhere to the above-mentioned contents, they would incur an administrative penalty, therefore all business units should make sure that they adhere to the concerned rules and regulations. Even the clients or the taxable recipients should ask for the invoice for which they have made payment the consideration, as this is proof of the transaction relating to the supply. This would also secure the recipient from fraud such as paying a higher tax than the actual rates, by providing transparency.

How can a Business Entity Avoid Errors in a Tax Invoice in UAE 

According to the law of VAT, all registrants should offer sufficient details in the tax invoice in UAE, this should not be incomplete or contain any wrong details otherwise the registrant would be responsible to make payment of administrative penalty. The right method to make sure that the invoice contains all the necessary details according to the law is to utilize software that will notify the user if any kind of detail isn’t involved and this will also help in making changes to the invoice according to the updates brought in the laws. Utilizing such software would save the registrant from making payment of a penalty and issue the invoice to the recipient in a timely manner.

Also read : No objection certificate from sponsor to work in UAE

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