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FTA VAT Public Clarification VATP009 on date of supply for independent directors

Posted on 07-Jan-2019 10:51 PM

 

 

VAT Public Clarification VATP009 on date of supply for independent directors addresses the issue of determining the date of supply for the Board fees paid to independent directors. The new document sets out the following:

Where the Board fees for independent directors are not known at the outset and are determined upon the conclusion of the annual general meeting (AGM), the date of supply is when the fees are known.

  • If the Board fees are determined upon conclusion of the AGM and the independent director does not issue an invoice or receive payment prior to this, as per Article 25 of the UAE VAT Law, the date of supply will be when the services are completed. In this instance, the FTA considers the services to be completed only when the fees are known upon conclusion of the AGM, even if the services were physically completed earlier.

Where the Board fees are known at the outset, the rules are as follows:

  • If there are periodic payments or consecutive invoices, the date of supply will be as per Article 26 of the UAE VAT Law. This will be the earliest of the:

 

  • date of issuance of a tax invoice;
  • date payment is due as shown on the tax invoice; or
  • date of receipt of payment.

 

  • If 12 months have passed from the date of provision of services and none of the above have occurred, the date of supply will be at the end of the 12th month.
  • If there are no periodic payments or consecutive invoices, the date of supply would be as per Article 25 of the UAE VAT Law. This will be the earliest of the:

 

  • date of issuance of a tax invoice;
  • date on which the provision of services was completed; or
  • date of receipt of payment.

 

 


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