UAE Tax Invoice Format: Difference between a Simplified & Full Tax Invoice

Understanding the correct UAE VAT Invoice format can make or break your business.

Please read this, if you have been in one of the following situations:

  1. Not sure if the invoice you raise to your client has all the details required to make it a legal document?
  2. Trying to claim VAT on an invoice sent by one of your suppliers..

What is a Tax Invoice? : This is a document raised by all tax registrants for a taxable supply.

An invoice is no longer a legal document until it has the word “tax” in front of it.

Bottom Line: If you do not raise a Tax Invoice meeting the requirements of the FTA, you will attract penalties during a Tax Audit. The right UAE VAT Invoice format makes a big difference.

The Tax Invoice needs to be issued and delivered to the customer.

When are you allowed to raise a Simplified Tax Invoice?

The FTA has given an option to raise a tax invoice with less requirements in special cases –

  1. When the recipient of the supply (service or goods) is not registered for VAT, or
  2. When the supply (service or goods) made is not over AED 10,000.

 

In all other cases a regular full Tax Invoice needs to be raised

What are the minimum requirements of a Simplified Tax Invoice?

1) The words “Tax Invoice” clearly displayed on the invoice; 

2) The name, address, and Tax Registration Number of the supplier;  

3) The date of issuing the tax invoice; .

4) A description of the goods or services supplied; and  

5) The total consideration and the tax amount charged.

Do note that in a simplified tax invoice, it is allowed to show the gross value of each line item (i.e. including VAT)

What are the requirements of a regular Full Tax Invoice?

1) The words “Tax Invoice” clearly displayed on the invoice. 

2) The name, address, and Tax Registration Number of the Registrant making the supply. 

3) The name, address, and Tax Registration Number of the Recipient where he is a Registrant. 

4) A sequential Tax Invoice number or a unique number which enables identification of the Tax Invoice and the order of the Tax Invoice in any sequence of invoices. 

5) The date of issuing the Tax Invoice. 

6) The date of supply, if different from the date the Tax Invoice was issued.

7) A description of the Goods or Services supplied. 

8) For each line item you need to provide the unit price, the quantity supplied, rate of tax, tax amount, gross amount payable (optional) and net amount payable.

9) The amount of any discount offered. 

10) The gross amount payable expressed in AED. 

11) The Tax amount payable expressed in AED together with the rate of exchange (as per the central bank) applied where the currency is converted from a currency other than the UAE dirham. 

12) Where the invoice relates to a supply under which the Recipient of Goods or Recipient of Services is required to account for Tax, a statement that the Recipient is required to account for Tax, and a reference to the relevant provision of the Decree-Law.

Need help with your UAE VAT Invoice format or a full fledged VAT Health Check? Contact our professional team of tax advisors to make sure you are meeting all the compliance requirements.

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