The 'Place of Supply' determines the jurisdiction in which tax is payable. It is determined differently for goods and services.
Place of Supply of Goods
- Domestic Supplies: If goods are located in UAE during supply, the place of supply is UAE.
- Exports (to non-GCC): If goods are dispatched from UAE, the place of supply is UAE (but likely Zero-rated).
- Intra-GCC Supplies:
- If customer is VAT-registered: Place of supply is the destination state.
- If customer is not registered: Depends on supplier's export threshold.
- Imports: The country where goods are declared for consumption (e.g., if imported into Abu Dhabi, place of supply is Abu Dhabi/UAE).
Place of Supply of Services
Basic Rule: The place of supply is where the supplier has their place of residence.
Exceptions
- Imports (from non-GCC): If recipient is VAT-registered in UAE, place of supply is UAE.
- Installation Services: Where the installation is done.
- Real Estate Services: Where the property is located.
- Hotel/Restaurant Services: Where the service is actually performed.
- Cultural/Arts/Sports: Where the event is performed.
- Passenger Transport: Where the journey begins.
- Telecom/Electronic Services: Where the services are used or received.