If you’re a tourist planning a shopping spree in Dubai, it’s crucial to understand how you can make the most out of your purchases by taking advantage of the Value Added Tax (VAT) refund scheme. In this blog post, we’ll guide you through a step-by-step process on how to claim your VAT refund and enjoy tax-free shopping in one of the world’s top retail destinations.
Dubai is a global shopping haven known for its luxurious malls and traditional markets, also known as “souks.” Exploring these commercial hubs can be even more enjoyable knowing that you can claim a refund on the Value Added Tax (VAT) paid on your purchases. Thanks to the UAE’s VAT Refund Scheme for Tourists, you can get back a significant portion of the VAT you’ve paid while shopping during your stay.
VAT Refund in Dubai
The VAT Refund Scheme in Dubai was introduced by the UAE government to boost tourism and encourage more visitors to shop in the country. Under this scheme, tourists can claim a refund of 85% of the total VAT amount paid, minus a fee of AED 4.80 per Tax-Free Dubai Tag. This means that for every purchase you make, a part of the tax you paid can be reclaimed, reducing the overall cost of your shopping.
Benefits of VAT refund for tourists
The VAT refund scheme brings a host of benefits for tourists. First and foremost, it makes shopping in Dubai more affordable as you can reclaim a significant portion of your expenses. Secondly, it encourages tourists to spend more, knowing that part of their expenditure will be refunded. Lastly, this scheme also contributes to Dubai’s appeal as a top retail destination in the world.
How to Get a VAT Refund in Dubai
Claiming your VAT refund is a straightforward process if you follow the right steps. Here’s a step-by-step guide to help you navigate through this process smoothly:
Step 1: Making a Tax-Free Purchase
When shopping in Dubai, ensure that you make your purchases from retailers participating in the ‘Tax Refund for Tourists Scheme’. These retailers display a ‘Tax Free’ logo at their stores, making it easy for tourists to identify them. Once you’ve made your purchase, remember to request a tax-free receipt or a Tax-Free Tag for your items.
How to request a tax-free purchase
To request a tax-free purchase, simply inform the cashier at the point of sale that you wish to claim a VAT refund on your purchase. They will provide you with a Tax-Free Tag and receipt, essential documents for claiming your VAT refund.
Show your passport
When making a tax-free purchase, it’s crucial to present your original passport. The retailer needs to verify your tourist status and validate your eligibility for the VAT refund. Therefore, always carry your passport while shopping in Dubai.
Step 2: Get Tax-Free Tag
The next step is obtaining a Tax-Free Tag for each of your purchases. This tag, which is usually attached to your receipt, is a unique identifier that helps track your purchase and the VAT paid on it.
The Tax-Free Tag contains important information such as the VAT amount, purchase details, and a unique QR code. This QR code is used later in the refund process to validate your claim and process your refund.
How to ensure your receipt has a tax-free tag
To ensure your receipt has a Tax-Free Tag, always check your receipt before leaving the store. If the tag isn’t attached, ask the retailer to provide one. Without this tag, you won’t be able to claim your VAT refund.
Step 3: Claim Your VAT Refund Online
Once you have your Tax-Free Tag and receipt, you can proceed to claim your VAT refund online. The Federal Tax Authority’s (FTA) e-Services portal provides a user-friendly platform to do this.
Using the FTA’s e-Services portal
To use the FTA’s e-Services portal, first register for an account using your details. Once registered, log in and navigate to the ‘VAT refunds’ tab. Here you’ll find a form to submit your VAT refund claim.
Navigating to the VAT refunds tab and completing the form
On the VAT refunds tab, you’ll need to enter the details from your Tax-Free Tag and receipt. Make sure to enter all the required fields accurately, including the VAT amount and purchase details. After filling out the form, submit it to initiate your VAT refund claim.
What to expect after submitting your refund request
Once you’ve submitted your refund request, you’ll receive a confirmation message from the FTA. The processing time for VAT refunds can vary, but you should generally expect to receive your refund within 9 calendar days. If you don’t receive your refund within this period, you can contact the FTA’s Customer Happiness Centre for assistance.
Step 4: Claiming Your VAT Refund Using the Self-Refund System
If you prefer not to use the online system, or if you’re having difficulty accessing it, there’s another way to claim your VAT refund – the self-refund system available at various locations around Dubai.
Scanning the QR code on the Tax-Free Tag
To use the self-refund system, scan the QR code on the Tax-Free Tag at a VAT refund kiosk. These kiosks are conveniently located at various points across Dubai, including shopping malls and airports.
Steps to complete the VAT refund transaction
After scanning your QR code, follow the instructions displayed on the kiosk screen to complete your refund transaction. The system will verify your purchase details and calculate the refund amount. Once approved, the refund will be credited to your chosen payment method.
Step 5: Track Your VAT Refund Status
After submitting your VAT refund request, it’s essential to keep track of its status.
This can be done by scanning the QR code on your Tax-Free Tag. Your refund status will then be displayed, allowing you to monitor the progress of your refund claim.
How to scan the Tax-Free Tag QR code to track your refund
To track your VAT refund status, simply scan the QR code on the Tax-Free Tag using a QR code reader app or your smartphone’s camera. This will take you to a tracking page displaying the current status of your refund.
Understanding different refund statuses
When tracking your refund, you may encounter various status updates. Here are a few you might come across:
- Waiting for Goods Validation – The validation team needs to inspect your goods before the VAT refund can be issued.
- Payment in Progress – The VAT refund is being processed. This can take around 9 days to reflect in your bank account and up to 3 weeks to appear on your bank statements, depending on your card provider.
- Paid – Your refund has been processed and paid via your selected VAT refund method.
- Declined – Your VAT refund request has been canceled. In case your VAT refund has been declined, contact customer services.
- Blocked – The payment could not be processed, and additional information is required for the VAT refund. Contact customer services if your VAT refund is blocked.
Additional Information
Here are some additional pieces of information that may be helpful when claiming your VAT refund in Dubai:
VAT Refund Eligibility Criteria for Tourists
Not everyone is eligible for a VAT refund. To qualify for a VAT refund, you must be a tourist visiting the UAE, and you must have made your purchases from a retailer participating in the ‘Tax Refund for Tourists Scheme’.
Additionally, you must export the purchased goods out of the UAE within 90 days from the date of purchase. Make sure you keep your original receipts and Tax-Free Tags as proof of your purchases.
Locations of VAT Refund Kiosks in Dubai
VAT refund kiosks are located at various points around Dubai, including airports, shopping malls, and certain retail stores. At these kiosks, you can claim your VAT refund instantly by scanning your Tax-Free Tag’s QR code and following the on-screen instructions.
How to Calculate Your VAT Refund
Calculating your VAT refund is quite simple. For a 19% VAT rate, use the formula (Price-Price/1.19)*0.91 to calculate your refund. Deduct the refund amount from the price to know how much you are effectively paying for the item.
Conclusion
Claiming a VAT refund on your shopping in Dubai is a straightforward process that can save you a significant amount of money. By understanding the steps involved and keeping track of your purchases and refunds, you can make the most out of your shopping experience in Dubai.
Tips for Maximizing Your VAT Refund in Dubai
To make the most of the VAT refund scheme, here are some useful tips:
- Plan your shopping: Stick to retailers participating in the ‘Tax Refund for Tourists Scheme’ to ensure your purchases are eligible for a VAT refund.
- Keep track of your receipts: Always ask for a Tax-Free Tag and receipt for each purchase and keep them safe. Without them, you can’t claim your VAT refund.
- Claim your VAT refund before leaving the UAE: Remember to claim your VAT refund before departing the UAE. It’s easier to resolve any issues while you’re still in the country than after you’ve left.
The VAT refund process in Dubai is a valuable opportunity for tourists to save money on their shopping. By understanding the process and following the necessary steps, you can make your shopping trip in Dubai even more rewarding. So, prepare for your trip, plan your purchases, and happy shopping!