The construction and operation of mosques is a common activity carried out by relevant persons in the UAE. However, since it doesn’t constitute a business activity, recovery of input tax was not possible under the normal rules for refund of Value Added Tax (VAT) in the UAE. The UAE now allows the Refund of Input Tax Incurred on the Construction and Operation of Mosques as per Cabinet Decision No. (82) of 2022. Tax agents in Dubai can provide you with further information on the provisions of this law.
For making the law clear to the relevant persons, the UAE Federal Tax Authority (FTA) has issued a new guideline (VATGRM1). As per the new Value Added Tax (VAT) GRM1, the Federal Tax Authority (FTA) will refund the Value Added Tax (VAT) paid on any supply or import made by a person or class of persons listed in the Cabinet Decision and will provide a special refund mechanism for eligible persons constructing and/or operating a Mosque, subject to certain conditions.
The following blog will provide you with key information on the eligibility criteria and conditions and requirements you need to meet for the Refund of Value Added Tax (VAT) Incurred on the Construction and operation of Mosques in the UAE:
