Cabinet Decision No. 25 of 2018 establishes a special Value Added Tax (VAT) accounting mechanism for the supply of gold and diamonds between registered businesses within the UAE. Effective from 1 June 2018, this Decision implements a reverse charge system for these specific goods. As detailed in Article 2, when a registered supplier provides gold or diamonds to a registered recipient who intends to resell or use them in manufacturing, the supplier is not required to account for the VAT. Instead, the recipient becomes responsible for calculating and accounting for the Due Tax on the supply.
Pursuant to the presentation of the Minister of Finance and the approval of the Cabinet,
Has decided:
Article 1 - Definitions
In the application of the provisions of this Decision, the following words and expressions shall have the meanings assigned against each, unless the context requires otherwise:
Authority
:
Federal Tax Authority.
Tax
:
Value Added Tax.
Taxable Person
:
Any natural or legal person registered or obligated to register for Tax purposes under the referenced Federal Decree-Law No. 8 of 2017.
Tax Registration
:
A procedure according to which the Taxable Person or his legal representative registers for Tax purposes at the Authority.
Tax Registration Number
:
A unique number issued by the Authority for each person registered for Tax purposes.
Goods
:
Gold, diamonds and any products where the principal component is of gold or diamonds.
Registrant
:
The Taxable Person who has been issued with a Tax Registration Number and is licensed to conduct any activity related to the Goods by the competent government entity.
Supplier
:
The Registrant who is supplying Goods in the State.
Recipient
:
Person to whom Goods are supplied.
Due Tax
:
Tax that is calculated and charged pursuant to the referenced Federal Decree-Law No. 8 of 2017.
Article 2
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