VAT, as you may already know, is paid by the end consumer on goods and services bought. But tourists are exempted from paying VAT. Tourists shopping in the United Arab Emirates qualify to reclaim 85% of the total VAT amount paid (The remaining 15% is charged as an administration fee) provided that they meet certain criteria. In addition to that, cash refunds are capped at AED 7,000 per day as per new regulations imposed by the Federal Tax Authority. However, there is no such limit on the maximum recoverable amount if the transactions in question are made to a credit card. In order to be eligible for the VAT refund the tourists in UAE have to ensure:

  • The items they are expecting the VAT refund on are included in the FTA’s Refund Scheme.
  • They are buying goods from the retailers that are participants in the “Tax Refund for Tourists Scheme”. The seller will provide them a VAT free sticker on the goods purchased from their store.
  • They are leaving the UAE along with their purchases within the 90 days period from the date mentioned on the proof of purchase or invoice.