Importance of Entry/Exit Certificate – Dubai Customs
Let’s have a closer look on the provisions of VAT Decree Law, its Executive Regulations and Customs Notices.
As per Article 30 of Executive Regulations of VAT Decree Law on Zero Rating the Exports of goods, both Direct exports and Indirect exports must have “OFFICIAL AND COMMERCIAL” evidence of Export retained by the exporter.
Commercial Evidence includes the following:
1) Airway bill.
2) Bill of lading.
3) Consignment notes.
4) Certificate of shipment.
Official Evidence is explained as “Export documents issued by the local Emirate Customs Department in respect of Goods leaving UAE” Dubai Customs department had issued a Customs Notice in 2017 – Customs Notice No. 7 / 2017 on ‘Procedures for Proving Exportation of Goods for VAT Purposes’.
As per this Notice to prove exportation of the goods outside the country, the following procedures are required:
1. Issuing a customs declaration in accordance with customs procedures applicable for proving export of goods outside the country
2. Issuing authenticated Customs Exit / Entry Certificate
3. Actual examination (inspection) of goods (in terms of description, type, quantity, weight, country of origin etc.)
This Notice shall be applicable on consignments and goods being cleared by Customs starting
January 1, 2018.
With reference to above, it may be stated, when the movement of goods is through Dubai Customs and the businesses want to zero rate the transaction, apart from all other export related documents the Customs Exit / Entry Certificate is also a mandatory requirement.
To conclude, when exporting the goods from emirate other than Dubai the businesses should refer to the customs requirements of respective local emirate and arrange for all the required documents to support the export of goods is zero rated.
We are expecting that during FTA audits these documents will be required to substantiate that it’s a genuine case of export of goods and thus VAT is charged at zero rate.
We hope that businesses have followed the documentation and compliance requirements and are prepared for FTA audits.
For more information please contact us
Chartered House Tax Consultancy
Office # 1711 The Metropolis Tower
Business Bay, Dubai, U.A.E.
T: +971 4 2435666