FTA issues VAT Clarification VATP036 for SWIFT messages

Dubai, UAE, February 05, 2024 : The recent UAE VAT Public Clarification, VATP036, addresses the issue of VAT recovery for international bank charges incurred by financial institutions such as banks and exchange houses. Financial institutions are allowed to recover VAT on international bank charges only if these charges are related to making taxable supplies, and if the necessary supporting documents are obtained and retained.The typical evidence for these transactions is provided through SWIFT messages. However, SWIFT messages alone do not meet the requirements to be considered as tax invoices for UAE VAT purposes.

This clarification provides guidance on the acceptability of SWIFT messages for documentation purposes and the recovery of input tax.

Source : https://tax.gov.ae/